One of the auto-ancillary stocks engaged in design and manufacturing heavy forgings and high-precision machined components. The stock is in focus after receiving an order worth Rs. 135-145 crore for the supply of precision-engineered and machined components for power generation applications from a North American client.
Share Price Movement
In Thursday’s trading session, Happy Forgings Limited‘s share plunged by 0.40 percent from the previous close of Rs. 1,071.95. The stock opened at Rs. 1,119 and today closed at Rs. 1067.65, with a high of Rs. 1,130 and a low of Rs. 1,067.65. The market capitalization now stands at approximately Rs. 10,057.78 crore
What Happened
Happy Forgings Limited received an order for the supply of precision-engineered and machined components for power generation applications from a North American client.
The time period of the order is a minimum five-year period starting from Q2 FY26 through FY31, with potential for extension. The contract value is substantial, estimated at approximately Rs. 28 crores per annum at full capacity, with the total contract value ranging between Rs. 135-145 crores over the supply period.
Product Category
Happy Forgings Limited has a diverse product portfolio, catering to both automotive and non-automotive sectors. In automotive, the company serves major OEMs of commercial vehicles like Maruti Suzuki and Mahindra & Mahindra, while their non-automotive segment provides precision components for oil, gas, power generation, railways, and wind energy industries.
Manufacturing Facilities
Happy Forgings Limited operates three manufacturing plants in Punjab with a total installed forging capacity of 120,000 tons and a machining capacity of 47,000 tons. The company’s recent expansions include the installation of advanced forging presses to enhance production capabilities.
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Recent quarter results and ratios
Happy Forgings Limited’s revenue has increased from Rs. 343 crore in Q2 FY24 to Rs. 361 crore in Q2 FY25, which has grown by 5.25 percent YOY. The net profit of Kalpataru Projects International Limited has also grown by 29.09 percent, from Rs. 55 crore in Q2 FY24 to Rs. 71 crore in Q2 FY25.
Happy Forgings Limited’s revenue and net profit have grown at a CAGR of 24.90 percent and 32.02%, respectively, over the last four years.
In terms of return ratios, the company’s ROCE and ROE should be 22.7% and 18.7%, respectively. The debt-to-equity ratio of the company is to be 0.19x, which shows the company is almost debt-free. Happy Forgings Limited’s EPS is to be Rs. 27.5.
Shareholding pattern
In September 2024, Happy Forgings Limited had a majority stake held by the promoters at 78.60 percent, foreign institutional investors at 2.27 percent, domestic institutional investors at 17.13 percent, and the public at 1.99 percent.
Company Profile
Happy Forgings Limited was established in 1979 and headquartered in Ludhiana, India. The company is a leading manufacturer of complex and safety-critical heavy-forged and high-precision machined components. It ranks as the fourth largest engineering-led manufacturer in India based on forging capacity, specializing primarily in the automotive and industrial sectors.
Written By – Nikhil Naik
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