Happy Forgings
Stock Snapshot
Price Performance
Vista Outlook
Basis of our Recommendation
Happy Forgings is strategically transforming its revenue mix towards higher-margin industrial and passenger vehicle applications, supported by a robust INR 9.5 billion order book and significant investments in capacity expansion. Management's focus on heavy-forging capabilities and precision machining is expected to drive a projected 30% PAT CAGR through FY29, despite near-term challenges from export logistics and input cost inflation. Vista's financial outlook anticipates accelerating revenue growth beyond historical trends, with stable margins, reflecting confidence in the company's ability to navigate macroeconomic volatility and capitalize on improving pricing power within the forgings and castings industry. The favorable industry dynamics, characterized by stable demand and a forecast CAGR of 6.83%, further bolster this outlook. Over the next 12-24 months, key opportunities include scaling production capabilities and diversifying into high-precision components, while watchpoints include potential supply chain disruptions and fluctuations in raw material prices that could impact margins
Why We Like This Stock
- Strong order book of INR 9.5 billion supports revenue growth and operational momentum
- Strategic investments in heavy-forging capacity and precision machining are expected to enhance margins
- Improving pricing power within the industry is likely to bolster profitability
Things To Watch Out For
- Near-term headwinds from export logistics and geopolitical volatility could impact demand
- Input cost inflation poses risks to maintaining margin stability
- The capital-intensive nature of operations may introduce execution risks during capacity ramp-up
Key Parameters
Financial Snapshot
View Technicals Analysis →| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 1,358 | 1,409 | 1,546 | 1,738 | 1,951 |
| Profit Before Tax (Cr.) | 324 | 360 | 402 | 461 | 519 |
| PBT Margin | 23.9% | 25.6% | 26.0% | 26.5% | 26.6% |
| Net Profit (Cr.) | 249 | 275 | 311 | 356 | 401 |
| Earnings Per Share | 26.4 | 29.2 | 32.9 | 37.7 | 42.4 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Motilal Oswal | ▲ Buy | 2,438 | 15-Sep-2026 |
| ICICI Securities | ▲ Buy | 2,200 | 06-Aug-2026 |
Company Overview
Show Company Profile
Happy Forgings Limited manufactures and sells forgings and machined components for the automotive and industrial sectors in India and internationally. The company offers crankshafts; differential cases; front axle beams and steering knuckles; railway parts, including camshafts, connecting rods, piston pins, spacers, and others; brake flanges and suspension brackets; and transmission parts, such as shafts and spindles, crown wheels and pinions, and rings. It also offers windmill application products, including planet carrier, pinion shaft, and housing; oil and gas components, such as valve body; and bicycle pedals. It serves the original equipment manufacturers, manufacturers of commercial and passenger vehicles, farm equipment, and off highway and industrial equipment, as well as machinery for oil and gas, aerospace, power generation, railways, and wind turbine industries. Happy Forgings Limited was incorporated in 1979 and is based in Ludhiana, India.