New Delhi: India's Hindustan Aeronautics Ltd (HAL) reported a 77% surge in first-quarter profit, driven by strong realizations from aircraft manufacturing contracts.

The state-owned fighter jet manufacturer and maintenance provider posted a consolidated net profit of Rs 1,437 crore ($171 million) for the quarter ending June 30.

HAL is among several Indian capital goods and manufacturing companies that have benefited from increased government capital expenditure and efforts to localize defense production.

The company produces military aircraft, helicopters, engines, and also provides maintenance and repair services, with maintenance being its largest revenue stream, accounting for 72% of earnings in the year ending March 2024.

HAL's stock initially rose by as much as 2.3% following the results but later pared its gains, ending 0.8% lower.

Meanwhile, sector peers Bharat Electronics reported higher quarterly profits, while Bharat Dynamics posted a decline.