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INVESTMENT INSIGHTS

Check Before You Invest : Happy Forgings Ltd

BSE: 544057 NSE: HAPPYFORGE ISIN: INE330T01021
  |   Sector:  Automobiles   |   Industry:  Forgings

Snapshot

Q.1 Which industry/sub-sector does Happy Forgings Ltd belong to?
Happy Forgings Ltd belongs to the Automobiles sector, operating specifically within the Forgings segment.
Q.2 Is Happy Forgings Ltd a good quality company?
Happy Forgings Ltd is a good quality company, based on a consistently good 10-year financial track record.
Q.3 Is Happy Forgings Ltd undervalued or overvalued?
Happy Forgings Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.
Q.4 Is Happy Forgings Ltd a good buy now?
Happy Forgings Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Happy Forgings Ltd?
Happy Forgings Ltd revenue growth is 3.7% for FY-2025, which is below its 5-year CAGR of 20.35%, indicating slower growth.
Q.2 Return on capital employed (ROCE) of Happy Forgings Ltd?
Happy Forgings Ltd Return on capital employed is 19.16% for FY-2025, which is below its 5-year historical median of 21.81%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 13.5%, indicating value creation.
Q.3 Return on Asset of Happy Forgings Ltd?
Happy Forgings Ltd Return on Asset is 13.05%, which is below its 5-year historical median of 14.2%, indicating deteriorated asset utilization efficiency.
Q.4 Return on Equity (ROE) of Happy Forgings Ltd?
Happy Forgings Ltd Return on equity is 15.53% for FY-2025, which is below its 5-year historical median of 18.73%, indicating the business is making worse use of its shareholders capital.
Q.5 Cash conversion cycle of Happy Forgings Ltd?
Happy Forgings Ltd Cash conversion cycle is 142 days, above its 5-year historical median of 125 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover 0.69 0.85
ROE 15.53 18.73
ROCE 19.16 21.81
Cash Conversion Cycle 142 days 125 days
Q.6 Gross Profit margin of Happy Forgings Ltd?
Happy Forgings Ltd Gross profit margin which is the profit after deduction of direct costs, is 30.8% for FY-2025, which is above its 5-year median of 27.9%, indicating increasing margins.
Q.7 Operating Profit Margin of Happy Forgings Ltd?
Happy Forgings Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 28.88% for FY-2025, which is in line with its 5-year median of 28.53% indicating stable margins.
Q.8 Net Profit Margin of Happy Forgings Ltd?
Happy Forgings Ltd Net Profit Margin is 18.99% for FY-2025, is above with its 5-year median of 17.44%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin 30.8 27.9
Operating Profit Margin 28.88 28.53
Net Profit Margin 18.99 17.44
Q.9 Debt to Equity ratio of Happy Forgings Ltd?
Happy Forgings Ltd Debt-to-Equity ratio is 0.12, which is lower with the industry average of 0.49, indicating lower debt levels in the industry.
Q.10 Debt to cash flow from operations of Happy Forgings Ltd?
Happy Forgings Ltd Debt to cash flow from operations is 0.78, which is at a healthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Happy Forgings Ltd?
Promoters hold 78.48% of the Happy Forgings Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Happy Forgings Ltd vs industry peers?
Happy Forgings Ltd revenue CAGR is 20.35%, compared to the industry median CAGR of 14.05%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth 3.7 14.1
Gross Profit Growth 12.3 25.5
Operating Profit Growth 4.9 18.7
Net Profit Growth 10.3 26
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover 0.69 0.92
ROE 15.53 15.17
ROCE 19.16 14.66
Cash Conversion Cycle (days) 142.33 112

Valuation & price assessment

Q.1 Stock return of Happy Forgings Ltd over the last decade?
Over the last 1 year(s), the stock has delivered a CAGR of 73.01% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price
CAGR		 - - - 73%
Q.3 Valuation ratios of Happy Forgings Ltd vs historical?
The current P/E is higher that its historical median.
Q.4 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median		 5-year
Industry Median
Price to Earnings 44.63 39.80 33.04
Price to Book 6.26 5.04 3.77
Price to Sales 8.65 7.31 1.87
EV to EBITDA 27.08 24.23 16.81

Check more companies

1. Happy Forgings
2. Ramkrishna Forgings
3. Balu Forge Industrie
4. MM Forgings
5. Amic Forging
6. Tirupati Forge
7. Kalyani Forge
8. LGB Forge
9. Krishanveer Forge
10. Hilton Metal Forging

Check trending companies

1. PI Industries Ltd.
2. Max Financial Services Ltd.
3. Clean Science And Technology Ltd.
4. Birlasoft Ltd.
5. Redington Ltd.
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