Happy Forgings Forges Future Growth and Strong Margins

Ashwin Thakker

18 Aug 2025 — 1 min read

Sales Outlook: Targets 15-18% revenue growth from new business acquisitions. Domestic Commercial Vehicle and Farm segments expected to show high single-digit growth. Front axle beam revenue projected to reach Rs.50-60 crore annually next year.
Margin Outlook: Confident in sustaining gross profit (57.9%) and EBITDA (28.6%) margins at peak levels, with potential for further improvement from increased capacity utilization.

Happy Forgings Limited reported a resilient Q1 FY26 with 3.6% revenue growth, navigating industry headwinds. The company is actively pursuing new business and capacity expansions, targeting a robust 15-18% revenue growth from new ventures. This strategic focus aims to sustain profitability and drive future market share gains amidst evolving global dynamics.

Driving Growth Through Strategic Investments

Happy Forgings Limited is actively pursuing an ambitious growth strategy, targeting 15-18% revenue expansion from new business acquisitions. This endeavor is supported by a significant Rs.650 crore CAPEX plan, aimed at bolstering heavyweight forging infrastructure. New annual orders, including substantial wins from a European farm equipment OEM and for industrial data center components, demonstrate the company's success in securing a robust future pipeline. These strategic investments are designed to enhance operational strength and seize emerging market opportunities.

Sustaining Margins Amidst Market Dynamics

Despite ongoing industry headwinds, Happy Forgings remains confident in sustaining its healthy gross profit and EBITDA margins, currently around peak levels. While global commercial vehicle and off-highway markets show weakness, the company projects high single-digit growth in domestic CV and farm segments, driven by new product launches. The direct exposure to US tariffs is mitigated as OEMs bear the cost. This focus on high-value-added products and strategic customer engagement ensures margin resilience and diversified revenue streams.

Happy Forgings Limited demonstrates a robust forward strategy, focusing on new business acquisition, strategic capital expenditure, and diversified segment growth to counter market volatility. The commitment to high-value-added products and judicious capital allocation positions the company for sustainable long-term value creation, aiming for 15-18% growth from new ventures as markets stabilize.

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