Happy Forgings (HAPPYFORGE) Q4 25/26 earnings summary

Executive summary

• Achieved record annual profitability in FY 2026, with revenue of INR 1,546 crore and strong margin expansion year-over-year; Q4 FY 2026 saw sales growth of 20% YoY, with EBITDA and PAT up 30% and 24% respectively, marking the best-ever quarterly performance.

• Margin expansion driven by improved product mix, operating leverage, and execution; Q4 gross, EBITDA, and PAT margins at 59.4%, 31.5%, and 19.7% respectively.

• Transformation driven by capacity expansion, higher machining mix, operational efficiency, and focus on value-added growth.

• Diversification into industrial, passenger vehicle, and EV-linked programs is underway, reducing dependency on cyclical segments.

• Audited standalone and consolidated financial results for the year ended March 31, 2026, were approved with an unmodified audit opinion from statutory auditors.

Financial highlights

• FY 2026 revenue grew 9.8% YoY to INR 1,546 crore; Q4 revenue up 20.4% YoY to INR 422–424 crore; EBITDA for FY 2026 at INR 471 crore (up 15.7% YoY), with margins at 30.4%; Q4 EBITDA at INR 133 crore (up 30.4% YoY), margin at 31.5%.

• PAT for FY 2026 at INR 302 crore (up 14.8% YoY), margin at 19.5%; Q4 PAT at INR 84 crore (up 23.6% YoY), margin at 19.7%.

• Gross margin for FY 2026 at 59.1%, up 114 bps YoY; Q4 gross margin at 59.4%.

• EPS (diluted) for FY 2026 at INR 31.92–31.94, up from INR 28.37–28.40 in FY 2025.

• Cash flow from operations at INR 445 crore for FY 2026; cash and cash equivalents increased to INR 2,562.54 lakh (standalone) and INR 2,571.66 lakh (consolidated) as of March 31, 2026.

Outlook and guidance

• Expect late-teen volume growth in FY 2027, with EBITDA margins maintained at FY 2026 levels.

• Market share gains anticipated in commercial vehicles and new growth from industrial and passenger vehicle segments.

• CapEx guidance for FY 2027 is INR 450–500 crore, focused on high-growth capabilities; large CapEx for data center and heavy engine requirements to be completed by FY 2027, with revenue contribution from FY 2028.

• Margin impact from geopolitical developments and cost inflation expected to be manageable due to raw material pass-through and customer negotiations.

• Cost benefits are expected from the increased solar power plant capacity for captive consumption.