Will the Russian war have an impact on the performance of HAL?

Hindustan Aeronautics or HAL should have ideally corrected sharply as the company still largely relies on Russia for spare part supplies. However, the reason HAL stock has been robust in the last few days is that HAL has an inventory of about 9-10 months and does not see any disruption. Technically, the supply chain bottlenecks in Russia could potentially impact about 33% of the sales of HAL.

In an incisive report, CLSA has pointed out that HAL has enough inventories to last till the time these supply chain issue are amicably resolved. HAL is also simultaneously working on indigenous production of Russian supplies to reduce import dependence to hedge risk. The bottom line is that either ways, the risk to HAL is not too high from the Russian disruption, which explains why the stock has been an outperformer.