Happy Forgings is an Indian manufacturer that was founded in July 1979 and specializes in creating heavy forgings and highly accurate machined components.
- A SUMMARY
- From December 19 to December 21, Happy Forgings will hold its initial public offering (IPO).
- The IPO will allow the company to raise Rs 1008.59 crore.
- Expected IPO listing date is December 27.
The public bidding for Happy Forgings’ initial public offering (IPO) will begin on Tuesday, December 19. The forging company is charging between Rs 808 and 850 for each share. There is a set lot size of 17 equity shares. The last day of the IPO would be Thursday, December 21.
Happy Forgings is an Indian manufacturer that was founded in July 1979 and specializes in creating heavy forgings and highly accurate machined components. Three manufacturing facilities—two in Kanganwal and one in Dugri—are owned by Happy Forging in Ludhiana, Punjab.
Through its IPO, Happy Forgings hopes to raise a total of Rs 1,008.59 crore. This would include an offer by its promoter Paritosh to sell 71,59,920 shares in addition to a new sale of shares valued at Rs 400 crore.
Happy Forgings’s transformation from a forging-led company to a major player in the machined component manufacturing industry, according to Anand Rathi Research, can be attributed to its diverse product portfolio and emphasis on margin-accretive and value-additive products.
It provides services to a broad range of industries, including the wind turbine, power generation, oil and gas, and railroad sectors. With a market capitalization of Rs 8,007.4 crore after equity shares were issued and a return on net worth of 21.12%, the company is valued at a P/E ratio of 38.4 times. Regarding valuation, we think the business is priced appropriately. ‘Subscribe for long term’ was the rating assigned when it was added.
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Happy Forging is the fourth-largest manufacturer of complex machine components, with a wealth of experience. The business has a deep history of cooperation with its sizable clientele. It has a proven track record of steady growth and a diversified business model. According to Swastika Investmart, the company has had excellent financial performance as well.
“Investors need to be aware of some dependencies. Risks include depending too much on the top 10 clients, possible client pressure on prices, and industry competition. Reliance on a small pool of suppliers is another important factor to take into account. Happy Forgings is a viable investment choice for those looking to gain exposure to the manufacturing industry because of its competitive valuation, stellar performance, and optimistic outlook.
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In the crankshaft manufacturing business, Happy Forgings is the dominant force, with the second-largest production capacity for industrial crankshafts with high horsepower and commercial vehicles. Arihant Capital Markets stated in IPO notes that internal manufacturing, automation, and process optimization would increase margins.
“The company is aiming for new opportunities in Europe and China, where it has established long-standing relationships with customers. Going forward, growth would result from the strategic acquisitions made to increase business, geography, new products, and customers. The issue has a’subscribe’ rating and is valued at an EV/Ebitda of 22.9 times based on FY23 Ebitda and PE of 37.9 times of FY23 EPS,” the statement continued.
