Happy Forgings (HAPPYFORGE) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 revenue reached INR 354 crores, up 3.6%-4% year-over-year, with finished goods volume growing 3.8% to 14,457 MT, driven by strong domestic demand in Passenger Vehicles, Farm Equipment, and Industrials, despite deflationary steel prices and export headwinds.

• Gross profit margin improved to 57.9%, EBITDA margin remained robust at 28.6%, and PAT was INR 66 crores with a PAT margin of 18.6%.

• Realization per kg held steady at INR 245, supported by a higher share of value-added components.

• Maintained strong liquidity position with over INR 350 crores at quarter-end, supporting ongoing capex and future growth initiatives.

• EPS (diluted) for Q1 FY26 was Rs. 6.96-6.97, up from Rs. 6.76-6.78 in Q1 FY25.

Financial highlights

• Revenue from operations: INR 354 crores, up 3.6% year-over-year; finished goods volume at 14,457 MT.

• EBITDA: INR 101 crores, margin at 28.6%, up 3.6% year-over-year.

• PAT: INR 66 crores, margin at 18.6%, up 3.2% year-over-year.

• EPS (diluted) for Q1 FY26 was Rs. 6.96-6.97.

• Working capital cycle remains efficient, with liquidity over INR 350 crores.

Outlook and guidance

• Management maintains a medium-term growth outlook of 15%-18% annually, driven by new product developments and business wins.

• Ongoing capex of Rs. ~80 Crs in FY26 to scale Passenger Vehicle segment; Rs. 650 Crs investment in heavy forgings capacity, with new facilities expected to be commissioned by FY27.

• Near-term growth is contingent on market recovery, especially in CV and farm equipment sectors.

• CapEx plan for FY26 is INR 300 crores (excluding solar), with INR 120 crores already spent in Q1.

• Additional capacity expansions and new product ramps expected in coming quarters.