Reports indicate that Air India is close to placing a large jet order with the world’s largest aircraft manufacturer, The Boeing Company (BA). This, along with a series of large government military equipment orders, may represent a major breakthrough for its ailing stock. According to a Reuters report, Air India is close to placing orders for up to 500 jetliners from both Boeing and Airbus. The order reportedly includes "dozens" of Boeing 787s and 777s. The deal is expected to be worth tens of billions of dollars, even with discounts included.

Consequently, some top investment banks began upgrading the stock after a long period of lackluster outlook. Thus, JPMorgan analyst Seth Seifman upgraded Boeing with an Overweight rating and raised the price target from $170 to $200 following the above-mentioned report that the company could be in line for a huge order from Air India.

Air India is owned by Tata Group. The news came just days after Tata Group announced the merger of Air India and Singapore Airlines joint-venture Vistara to strengthen its presence in the industry.

Meanwhile, United Airlines Holdings (UAL) announced on December 13, 2022, its plans to buy up to 200 Boeing 787 Dreamliners as part of its United Next plan to replace its aging fleet. Deliveries are expected between 2024 and 2032. United also exercised options to purchase 44 Boeing 737 MAX plans for delivery between 2024 and 2026 and 56 MAX airplanes between 2027 and 2028.

BA stock was beaten down by over 75% off its highs at $446.01 in 2019 being pummeled by the infamous 737 MAX crashes and the Covid-19 pandemic no-fly months. However, the Company and the stock have since been in a “common sense” recovery mode as shares trim their losses to -11% for 2022, faring better than the S&P 500 (SPY), down (-18%).

But residual pandemic and geopolitically evoked supply chain bottlenecks still prevent the Company from manufacturing more planes for delivery as it expects challenges to continue throughout 2023. For example, it lacks engines for its 737, preventing it from increasing deliveries. It expects $2 billion in abnormal costs for the 787 program as it reworks inventory and decreases production levels. Still, the Company expects to see $3 billion to $5 billion in free cash flow in 2023, which is healthy enough to consider BA as a fresh entrant into a private equity portfolio.