Why did HBL engineering shares jump more than 8% today?

Synopsis: HBL Engineering shares jumped 8% after the company highlighted strong future demand for TCAS systems despite partial order cancellations. Shortfall in supply has led to 7,000 units being re-tendered in the industry. Along with 11,429 fresh TCAS tenders already floated, total visible demand rises to 18,429 units, reassuring investors on long-term growth visibility.

The shares of this company, which manufactures and provides services for different types of batteries, e-mobility, and other products, had its shares in momentum today, which is due to the investor report which stated an increase in demands for TCAS due to the cancellation of the previous contract and the re-rendering of it. 

With the market cap of Rs 22,729 crore, the shares of HBL Engineering Ltd had hit their intraday high at Rs 827.35, gaining about 8 per cent compared to their previous day’s closing price of Rs 763.20. The shares are trading at a PE of 34.2, whereas their industry PE is at 29.3, and have given a return of 2,720% over the last 5 years. 

What’s the news? 

HBL Engineering informed investors about the status of its Train Collision Avoidance System (TCAS) orders awarded in 2024. The company had received an order for 2,200 Loco TCAS units, with the final delivery deadline set for 13 December 2025. By this date, HBL successfully delivered and installed 1,659 units, accounting for 75.4% of the order, while the remaining 541 units were cancelled as per the purchase order terms due to non-delivery within the stipulated timeline.

The update also highlighted that the delivery shortfall was not limited to HBL alone. Across the industry, a total of 10,000 TCAS units were tendered in 2024 to five suppliers, but cumulative deliveries from all suppliers are estimated at only around 3,000 units. As a result, nearly 7,000 undelivered units stand cancelled and are expected to be floated again as a fresh tender, indicating that the underlying demand for TCAS systems remains intact.

Looking ahead, demand visibility has significantly improved. HBL disclosed that three new TCAS tenders aggregating 11,429 units have already been floated and are likely to be finalised before 31 March 2026. When combined with the expected re-tendering of the 7,000 cancelled units, the total visible demand for the next year rises sharply to 18,429 TCAS units, a level that was earlier unforeseen. This points to a strong pipeline for railway safety equipment driven by Indian Railways’ continued focus on accident prevention.

The stock’s 8% rally can be attributed to this clarity on future demand. While the cancellation of part of the earlier order initially appeared negative, investors took comfort from the fact that cancellations are likely to convert into fresh tenders, alongside a much larger upcoming order opportunity. The visibility of 18,429 units of potential demand reassured the market about HBL’s long-term growth prospects in TCAS, helping improve sentiment and drive the sharp move in the share price. 

Financials and more.  

The revenue from operations for the company stands at Rs 1,223 crores in Q2 FY26 compared to Q2 FY25 revenue of Rs 521 crores, up by about 135 per cent YoY. Similarly, the net profit stood at Rs 387 crore in Q2 FY26, up from Rs 87 crore in Q2 FY25, giving a growth of about 345 per cent. 

HBL Power Systems is a technology-focused, engineering-led company that builds specialised products by identifying and solving critical technology gaps in India. Backed by strong in-house R&D, it operates across industrial batteries, defence electronics, electronic rail signalling, and electric drive trains for heavy electric trucks, serving mainly B2B and B2G customers. 

The company deliberately focuses on niche, high-entry-barrier markets that are often overlooked by larger players, allowing it to build leadership positions, most notably as India’s only manufacturer of PLT (lead) batteries, while maintaining a capital-light and profitable business model.

Written by Leon Mendonca. 

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