Happy Forgings (HAPPYFORGE) Q3 25/26 earnings summary

Executive summary

• Achieved record performance in Q3 and nine months FY26, with all-time highs in revenue, gross profit, EBITDA, and PAT, driven by strong domestic demand in commercial vehicles, farm equipment, and passenger vehicles, despite challenging export markets and softening steel prices.

• Q3 FY26 revenue rose to Rs. 39,130.70 lacs, up from Rs. 35,432.46 lacs YoY, with nine-month revenue at Rs. 1,12,249.59 lacs; PAT for Q3 was Rs. 7,894.07 lacs, up from Rs. 6,454.74 lacs YoY.

• Profitability growth outpaced revenue, with Q3 PAT up 22.3% YoY and strong cash generation enabling self-funded capacity expansion.

• Sequential improvement in Q3 over Q2 signals sustained growth momentum, positioning for a strong FY26 close.

• EPS for Q3 FY26 was Rs. 8.37 (basic), with nine-month EPS at Rs. 23.13.

Financial highlights

• Q3 FY26 revenue from operations: INR 391 crore (up 10.4% YoY); nine-month revenue: INR 1,122 crore (up 6.2% YoY); Q3 PAT: INR 79 crore (up 22.3% YoY); nine-month PAT: INR 218 crore (up 11.8% YoY); EBITDA: INR 120 crore (up 18.7% YoY); nine-month EBITDA: INR 337 crore (up 10.8% YoY).

• Gross margin for Q3 FY26: 58.9%; nine-month gross margin: 59.1%; EBITDA margin for Q3: 30.8%, nine months: 30.1%; PAT margin for Q3: 20.2%, nine months: 19.4%.

• Cash flow from operations for nine months: INR 315 crore; liquid assets exceed INR 400 crore.

• EPS (diluted) for nine months: 23.09; for Q3: 8.36.

• Total income for Q3 FY26 was Rs. 39,947.01 lacs, with total expenses at Rs. 29,580.03 lacs.

Outlook and guidance

• EBITDA margins expected to remain in the 29%-31% range over the medium term.

• Domestic demand momentum anticipated to continue; export pressures expected to subside, with new business of INR 800 crore to commence from FY27.

• Export percentage of revenue projected to improve meaningfully from Q2 FY27, driven by ramp-up in industrial, EV, and PV export programs.

• U.S. revenue share expected to rise from 7%-8% to 15%-16% in the next few years, aided by favorable tariff changes.

• Unutilized IPO proceeds of Rs. 7,646.90 lacs as of December 31, 2025, are temporarily invested in fixed deposits, with future deployment planned for equipment purchases.