Happy Forgings Ltd

Financial Performance

• Q1 FY27 revenue Rs 449 crore, up 27% YoY; PAT Rs 91 crore.
• EBITDA Rs 141 crore; EBITDA margin 31.3%, up 275 bps.
• Gross margin 60.7%, up 276 bps; gross profit Rs 273 crore.
• Volume growth 23.1%; finished goods up 23%; realizations Rs 253 per kg.
• PAT Rs 91 crore; PAT margin 20.4%, up 178 bps.
• Capacity additions: 4,000-ton forging press; 7,200 MT machining added.
• Total forging capacity 1,52,000 MT; machining 75,200 MT.
• Order book around Rs 950 crore; peak incremental revenue potential in 2–3 years.

Segment Performance

• CV: 33% of revenue; domestic growth ~18%; exports affected by transit delays.
• Farm equipment: 32% revenue; domestic growth >20%; exports growth despite US/Europe headwinds.
• Industrial: 16% revenue; ~50% growth across domestic and export.
• Off-highway: 11% revenue; >40% growth; domestic construction equipment ~9%.
• PV: 8% revenue; >70% growth; domestic >40%.
• Exports from PV more than double; Europe share ~60% of exports.
• Export mix: CV ~7%, PV ~8%, Farm ~5%, Off-highway ~5%, Industrial ~9%.

Capex and Capacity

• 14,000-ton press line utilization about 65–70%.
• Added 10,000-ton press line; some 14k components shifted to 10k.
• 18,000-ton vertical upsetter line: commissioning from Q4; trials from Q3.
• Capacity shift enables larger heavy-line capacity.
• Capex program Rs 650 crore; funded largely from internal accruals.
• Gross margins for new capex: full machined components ~80%; forged crankshafts 60–65%.

Captive Power and New Ventures

• Captive solar project on track; contribution from January onwards; ROW clearance in progress.
• Power benefit 1–1.5%; margin could stay above 30%.
• FY29 onwards: meaningful contribution from new scheme of business.

Outlook and Guidance

• Guidance: FY27 remains positive; EBITDA margin around 30%+.
• Export-heavy portfolio; Rs 950 crore book to translate into revenue over 2–3 years.
• Growth largely funded from internal accruals; occasional bridge loan for LC if needed.
• Capex target about Rs 350–400 crore annually.

Q&A Highlights

• Export freight costs rose to USD 6,000; pass-through ~75%; net incremental cost ~15–20%.
• Export currency gains supported pricing; some domestic price increases in Q2.
• Q4 FY27: 14k press utilization 65–70%; load shift to 10k line.
• Export mix Europe around 60% of exports; PV export growth supported by Europe flow.
• Acquisitions/JVs open; focus on energy/aerospace; valuations high for inorganic moves.
• Organic growth funded by internal accruals; potential bridge loan for LC if needed.

Meeting Details

• Date and time: 14 August 2026, 10:00 AM onwards; format: physical meeting in Mumbai; organizer: Equirus Securities.

Participants

• Key participants: company officials (management) from Happy Forgings.

Purpose

• Purpose: investor conference discussions based on publicly available information.

AGM Details

• Date and mode: 27 July 2026, via Video Conferencing/OAVM.
• Shareholders on cut-off: 65,697; attendees via VC: 77 (7 promoter, 70 public).

Resolutions - Ordinary

• Adoption of standalone financial statements for year ended 31 March 2026; passed.
• Adoption of consolidated financial statements for year ended 31 March 2026; passed.
• Final dividend of Rs 4 per equity share; passed.
• Ashish Garg reappointed as Managing Director for five years; passed.
• Remuneration payable to Cost Auditors ratified; passed.
• Commission payable to Independent Directors approved; passed.
• Megha Garg reappointed as Whole-Time Director for five years; passed.

Resolutions - Special

• Re-appointment of Ravindra Pisharody as Independent Director for second term to Nov 2030; passed.

Directors & Key Appointments

• Ashish Garg reappointed as MD for five years.
• Megha Garg reappointed as Whole-Time Director for five years.

Auditors

• Remuneration payable to Cost Auditors ratified.

Dividend Details

• Final dividend of Rs 4 per equity share approved.

Related Party Transactions

• No material related party transactions approved.

Voting & Outcomes

• All resolutions passed; minor opposing votes observed in some items.

Meeting Details

• Date and time: 5 August 2026 at 10:00 AM IST.
• Type and mode: Earnings conference call; virtual group meeting.
• Event: Q1FY27 Post Results Conference Call.
• Organizer: Happy Forgings Limited.
• RSVP handled by Strategic Growth Advisors Pvt. Ltd.

Participants

• Key company participants: Managing Director; Chief Financial Officer.

Purpose

• Purpose: Discuss Q1 FY27 financial and operational performance for quarter ended 30 June 2026.

Notes

• No price sensitive information will be disclosed during the call.

AGM Details

• Held on 27 July 2026 at 11:30 IST via Video Conferencing/AV Means.
• Meeting concluded at 01:03 PM IST after 30 minutes of e-voting.
• Remote e-voting window: 24–26 July 2026; venue deemed Registered Office.

Key Resolutions

• Adoption of standalone financial statements for year ended March 31, 2026.
• Adoption of consolidated financial statements for year ended March 31, 2026.
• Declare final dividend of Rs 4 per equity share.
• MD Ashish Garg to be reappointed after retirement by rotation.
• Ratification of remuneration payable to Cost Auditors Rajan Sabharwal & Associates.
• Approve commission payable to Independent Directors.
• Reappoint Megha Garg as Whole-Time Director for five-year term.
• Re-appoint Ravindra Pisharody as Independent Director for term 2027–2030.

Voting Results

• Results of remote and in-meeting voting not disclosed in the filing.
• Intimation of results to stock exchanges and website to follow.

Director Changes

• Megha Garg to continue as Whole-Time Director for five years.
• Ravindra Pisharody to continue as Independent Director through 2030.
• Ashish Garg to be reappointed as MD by rotation.

Auditors

• Cost Auditors remuneration ratified as per the resolution.

Rating action and instruments

• ICRA reaffirmed Long-Term AA(Stable) and Short-Term A1+ ratings for bank facilities totaling Rs 485 crore.
• Instrument mix: 260 cr long-term fund-based, 150 cr short-term bill discounting, 75 cr unallocated limits.
• Rating action date: letter issued July 7, 2026; surveillance due within one year.
• Outlook: Stable for long-term ratings.
• Total rated facilities amount to Rs 485 crore across all instruments.

Dematerialisation status

• No dematerialisation or rematerialisation requests were received during the quarter ended 30 June 2026.
• Securities for dematerialisation were confirmed to depositories and listed on the stock exchanges.
• Dematerialisation certificates were mutilated and cancelled after verification; depository name substituted as registered owner within prescribed timelines.

AGM notice and AR access

• 47th AGM scheduled for 27 July 2026 at 11:30 IST via VC/OAVM.
• Annual Report 2025-26 accessible online; link and access path sent to members without registered emails.
• Cut-off date for email registration was 25 June 2026.
• Reminder to update KYC details under SEBI Master Circular 2024; PAN, address, mobile, and bank details requested.
• Physical holders urged to register email and complete KYC to continue receiving communications.
• SEBI formats for nomination and KYC are available on the company's listed resources.
• Queries may be directed to Compliance Officer via email or phone.