Buy Happy Forgings: target of Rs 2450: ICICI Securities

Moneycontrol • 2 days ago

Original source

Key Investment Pillars

  • Happy Forgings (HFL) is gaining wallet share from existing customers in the domestic CV/PV/farm segments, driving growth.
  • The company has a healthy order book of INR 10bn, executable over 2-3 years, which will support future growth.
  • HFL is expanding its capabilities into heavier and complex components, which could lead to higher profitability.
  • The global supply chain shift presents a large addressable opportunity for HFL.

Thesis Validation Checklist

  • Investors should watch for HFL's ability to sustain its margin around FY26 levels, despite inflationary pressures.
  • The company's growth trajectory, driven by new order visibility and execution, should improve meaningfully in FY27-29E.
  • HFL's success in securing new orders, especially for heavy-forged components, will be crucial to its long-term growth.
  • Any delays in order execution or inability to win new orders could pose a risk to the investment thesis.