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Here’s everything you need to know about Happy Forgings Ltd’s IPO

Here is an opportunity to enter the forging industry by investing in one of the top companies in the sector.

happy forgings ltd

The IPO season in India is at its peak. Are you finding it difficult to track them all and analyse which one suits you the best?

Worry no more. Today’s article discusses all the details about Happy Forgings Ltd’s IPO.

Participating in Happy Forgings Ltd’s shares will give you entry to the engineering and manufacturing sector, too. So, if this is your area of interest and you are looking for options to enter the primary market, the opportunity is right here.

Who is Happy Forgings Ltd?

Established in 1979 to manufacture bicycle arms, Happy Forgings has over 40 years of excellence in the manufacturing industry. Working on the installation of various heavy-duty equipment, Happy Forgings gradually ventured into industrial and commercial vehicle segments between 2010 to 2015.

Today, Happy Forgings has three manufacturing facilities and caters to the needs of domestic and global original equipment manufacturers (OEMs) in the automotive sector, farm equipment, industrial equipment for oil and gas, power generation, railways and wind turbine industries. It has an annual forging capacity of 1,07,000 tonnes and a machining capacity of 46,100 tonnes.

Happy Forgings stands number two in the production of crankshafts for commercial vehicles and high horsepower industrial requirements in India. It stands number four as an engineering-led manufacturer of heavy forged machinery components in India, with high levels of precision and safety.

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Vision – To be amongst the top 10 forging and machining companies globally.

Happy Forgings’ Financials

ParticularsFY 2023 (₹ million)FY 2022 (₹ million)FY 2021 (₹ million)
Revenue from operations₹11,965.30₹8,600.46₹5,849.58
Gross margin₹6,454.74₹4,716.54₹3,333.55
EBITDA margin %28.49%26.85%27.14%
Return on Equity21.12%18.07%13.40%
Return on Capital Employed24.24%19.38%16.13%
Debt to total net worth0.220.310.24
Earnings per share (₹) Basic₹23.32₹15.90₹9.66
Growth in revenue from operations %39.12%47.03%NA

Happy Forgings’ IPO

Happy Forgings Ltd IPO opening date19 December 2023
Happy Forgings IPO closing date21 December 2023
Bidding for anchor investors18 December 2023
Face value₹2 per share
Happy Forgings price band₹808 to ₹850

Issue size
₹1,008.59 crore
Fresh issue: ₹400 crores
Offer for sale: ₹608.59 crores
Issue typeFresh issue and offer for sale through book building
Minimum lot17 shares

IPO reservations
Anchor investors – 30%
Qualified institutional buyers – 20%
Non-institutional investors – 15%
Retail investors – 35%

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Shareholding pattern before IPO

Name of the shareholderShareholding pattern
Garg Family Trust42.51%
Ashish Garg14.47%
Ayusg Capital & Financial Services Private Limited12.01%
India Business Excellence Fund – III11.76%
Paritosh Kumar10.00%
Paritosh Kumar Garg (HUF)6.27%
Megha Garg2.70%

Fund utilisation plan

The funds collected from the offer for sale will entirely be used to compensate shareholders after deducting the offer’s expenses. 

The amount received from the new issue will be used for the following:

  • Purchasing plant, machinery and equipment.
  • Clearing the company’s loans, either partially or in full.
  • For other general corporate purposes.

Happy Forgings’ strengths

Revenue from Operations (₹ million)
EPS (₹) Basic

NAV (₹ per share)

P/E ratio
Return on Net Worth %
Happy Forgings Limited₹11,965.30₹23.32₹110.4321.12%
Bharat Forge Limited₹1,29,102.59 ₹11.35₹144.02102.637.88%
Craftsman Automation Limited₹31,826.00₹117.56₹651.6843.9218.04%
Ramkrishna Forgings Limited₹31,928.95 ₹15.52₹82.6749.3618.77%
Sona BLW Precision Forgings Limited₹26,550.10₹6.76₹39.1285.5617.26%
  • It can be seen from Happy Forgings’ financials that the company’s revenue is consistently growing. Happy Forgings ranks as one of the top players in the forging sector’s domestic market. 
  • The complexity of handling forging machinery and developing the skills to perform well in this area has created an entry barrier for new players to enter the market. This is an advantage for Happy Forgings, given the number of limited competitors.
  • Happy Forgings has a wide range of products in its portfolio, that has helped in creating a large customer base. In March 2023, Happy Forgings was second among the only two companies to have a 14,000-tonne forging press.
  • Happy Forgings has a diverse customer base covering requirements in the automotive and non-automotive sectors. In FY 2023, 44% came from automotive and 56% from the non-automotive sector.
  • The company has a healthy and strong connection with its customers. Given the limited number of manufacturers in this sector, Happy Forgings has been successful in retaining existing customers along with attracting new ones. In FY 2023, 76% of the revenue came from those who have been customers of Happy Forgings for over ten years.
  • The company has three well-built manufacturing facilities in Punjab. One of its strategic locations near the inland container depot facility has helped the company with cost and logistics advantages.

Also read: Services sector in India: An insight into India’s engine of growth 

Risks of investing in Happy Forgings

  • Despite having a large customer base, most of the orders for Happy Forgings are concentrated with few customers. In FY 2023, 70.8% of the revenue came from the top 10 customers. This concentration can be detrimental in case of disputes.
  • Similar to the customer pattern, the number of suppliers they have is limited, too. 89% of the total cost of steel sourced was from the top 3 suppliers in FY 2023. Delays and issues with suppliers can adversely impact Happy Forgings’ business.
  • Since Happy Forgings works in the B2B (Business to Business) sector, the company’s performance highly depends on the businesses in the automotive and non-automotive sectors. The reduction in demand for commercial vehicles can also affect Happy Forgings’ demand.
  • The company is capital-intensive and heavily reliant on fuel and power for the functioning of its equipment. Breakdown of machinery or disruption in power supply can affect the operations.

Subscription so far

As of 21 December 2023, the shares were subscribed 82.63 times. The number of shares offered was 8,306,061, while the bidding received was for 68,62,98,704.

The allotment of shares is expected to happen by 22 December 2023. The company will be available for trading on both NSE and BSE from 27 December 2023.


Investing in Happy Forgings may be a wise decision, considering the limited number of players in the market. However, it is essential that investors keep a watch on the risk factors before deciding to subscribe to Happy Forgings’ shares. 

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