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Happy Forgings reported stable Q4FY25 performance with PAT at Rs 678 million, in line with expectations. In its latest 20 May research update , Motilal Oswal reiterated a BUY rating on the stock with a target price of Rs 984, based on 26x FY27E earnings.

“A recovery in domestic CV demand, healthy tractor outlook and strong order wins in Industrials and PVs should help to offset the weakness in CV and tractor exports in the near term,” the report stated.

Quarterly & Annual Highlights:

Revenue: Rs 2.5 billion (up 2.5% YoY)

EBITDA Margin: 29.1% (+80 bps YoY)

FY25 Revenue: Rs 14.1 billion (+4% YoY)

PAT FY25: Rs 2.7 billion (+10% YoY)

Machining mix: Improved to 87% in FY25

Free Cash Flow: Rs 119 million after capex of Rs 2.8B

Management guidance included:

Rs 4 billion capex in FY26, including Rs 800 million for PV components

Order wins in PV and industrials totaling Rs 16 billion, with peak annual revenue potential of Rs 2.5B

Motilal Oswal expects CAGR of:

14% in revenue

16% in EBITDA

16% in PAT over FY25–27

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