Happy Forgings is poised for a sharp turnaround after several quarters of muted growth, driven by a revival in domestic demand and a slew of new order wins across key segments. According to Motilal Oswal's latest update, the company is expected to deliver a 17% revenue CAGR and 22% earnings CAGR between FY25 and FY28, supported by margin expansion and diversification beyond its traditional commercial vehicle and tractor businesses.
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Motilal Oswal Report
Motilal Oswal reiterates a 'Buy' rating on Happy Forgings Ltd. with a target price of Rs 1,200, implying a 17% upside from the current market price of Rs 1,028.
Ebitda margins are forecast to expand by 230 basis points to 31.2% by FY28, aided by an improved product mix. Return ratios are also set to strengthen, with ROE projected at 18.7% by FY28.
Despite near-term challenges in export markets, Happy Forgings' strong order pipeline, operational efficiency, and strategic diversification position it well for sustained growth.
The company's superior financial track record compared to peers is expected to remain a key competitive advantage.
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