Centum Electronics has secured a significant contract from Hindustan Aeronautics Limited (HAL) for the Utility Helicopter-Maritime (UH-M) program. This Phase-1 order, valued at ₹66 crore excluding GST, focuses on the design and development of an Active Electronically Scanned Array (AESA) radar system.

The AESA radar is designed to detect, classify, and track multiple maritime targets, greatly enhancing the UH-M helicopter's surveillance and operational capabilities in maritime environments.

Bangalore-based Centum Electronics announced the order on 23 February 2026, marking a key milestone in its contributions to indigenous defence electronics. This contract represents more than a one-off order; it underscores Centum's expertise in system-level design and development of high-technology defence systems.

Phase-1 work is scheduled for completion over the next two financial years, providing Centum with immediate revenue visibility.

Success in this phase paves the way for Phase-2, which could involve serial production and supply over five years, with an estimated value of around ₹500 crore.

The total potential value across both phases approaches ₹566 crore, aligning with reports of a broader ₹668 crore framework when factoring in extensions or GST implications.

The UH-M program itself is a critical indigenous effort by HAL to replace ageing Chetak helicopters in the Indian Navy and Coast Guard fleets. HAL plans to deliver up to 76 units, with induction targeted between 2027 and 2030.

The helicopter features twin engines, foldable wings, and advanced maritime capabilities, supporting India's self-reliance in naval aviation.

This deal reinforces the 'Make in India' initiative, highlighting growing private sector involvement in defence manufacturing alongside public giants like HAL.
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Execution risks loom large. Transitioning from Phase-1 to production depends on meeting stringent HAL and programme milestones. As a smaller player compared to BEL, Centum faces challenges in scaling manufacturing and financial resilience for complex projects.

Historical patterns show initial stock pops after defence orders often face profit-taking, with sustained gains hinging on de-risking later phases. Delays in UH-M induction, now eyed for 2027 onwards post prototype flights and trials, could cascade to radar timelines.

No major management controversies mar Centum's record, but delivering mission-critical radars demands flawless performance. Looking ahead, success here could cement Centum's role in advanced defence electronics, amid rising government defence budgets and self-reliance drives.

Broader tailwinds include partnerships like the prior MoU with BEL for radars and electronics, bolstering its ecosystem position. Investors eye this as a long-term revenue anchor, provided execution aligns with ambitions in India's evolving defence landscape.

IDN (With Agency Inputs)