Happy Forgings Ltd. share price target

Happy Forgings’ (HFL)’s Q1FY26 performance was broadly in line with our estimates. HFL continued to outperform peers in Q1. While PV / industrial / domestic farm segment continues to do well, domestic CV may likely pick up going ahead.

Happy Forgings (HFL) is a leading manufacturer of complex, heavy-forged and precision-machined components. HFL’s focus on enhancing its capabilities has helped expand the company’s product portfolio and customer base across diverse segments (CV, PV, farm, OHV, industrials) and geographies.

Happy Forgings (HFL)’s 2QFY25 result was encouraging as it reported a healthy EBITDA margin of 29.2% (+190bp YoY, est. 28%) led by a higher mix of machining and industrial segment.

4QFY24 results were operationally in line with our expectations, while
higher ‘other income’ and lower tax led to PAT beat at INR658m (est.
INR607m), up by 30% YoY. Happy Forgings (HFL) maintains its focus on
diversifying into industrials and exports, which contributed ~12%/20% of
FY24 revenue, compared to 4%/12% in FY23.

Issue Snapshot: Issue Open: December 19 December 21, 2023 Price Band: Rs. 808 850 *Issue Size: Up to Rs.,1008.59 (Fresh Issue of up to Rs 400 cr + Offer for sale of upto 7,159,920 eq sh ) Reservation for: QIB upto 50% eq sh Non-Institutional atleast 15% eq sh ((including 1/3rd for applications between Rs.2 lakhs to Rs.10 lakhs)) Retail atleast 35% eq sh Face Value: Rs 2 Book value: Rs 123.28 (September 30, 2023) Bid size: - 17 equity shares and in multiples thereof 100% Book built Issue IPO Note Happy Forgings Limited

IPO NOTE