Happy Forgings Ltd filed its Business Responsibility and Sustainability Report for the Financial Year 2025-26 with the stock exchanges on June 30, 2026. The report outlines the company's performance against the National Guidelines on Responsible Business Conduct (NGRBC) principles, highlighting significant progress in environmental efficiency and governance structures. The company reported a ~7% year-on-year reduction in Scope 1 and Scope 2 GHG emissions during the year, alongside achieving 100% Zero Liquid Discharge (ZLD) across all its manufacturing sites. To support its energy transition, the company commenced the installation of a 20 MW captive solar power plant. These initiatives align with its long-term targets to reduce GHG emissions by 50% by 2030 and install 20 MW of solar capacity by 2028.

Operational and Financial Metrics

Happy Forgings recorded a total energy consumption of 5,83,432 GJ in FY 2025-26, with energy intensity per rupee of turnover improving to 3.8 GJ/Lakh Rupees from 4.0 GJ/Lakh Rupees in the previous year. Water consumption stood at 2,64,918 kiloliters, with water intensity per rupee of turnover decreasing to 1.71 KL/Lakh Rupees. The company’s total Scope 1 and Scope 2 emissions were 98,266 metric tonnes of CO2 equivalent, with an emission intensity of 1.58 tCO2e/MT.

Workforce and Safety

The company employed a total workforce of 3,934 individuals, comprising 714 employees and 3,220 workers, as of the end of FY 2025-26. The workforce was predominantly male, with females constituting 3.6% of employees and 0.0% of workers. The Lost Time Injury Frequency Rate (LTIFR) for workers was recorded at 0.6 per million person hours worked, with zero fatalities reported during the year. The company provided health and accident insurance coverage to 100% of its permanent employees and workers.

Governance and Compliance

Happy Forgings has established an ESG Council to oversee sustainability initiatives, with Ms. Megha Garg, Whole Time Director, serving as the highest authority responsible for implementation. The company confirmed that it has not been subject to any fines, penalties, or settlements by regulatory or law enforcement agencies during the financial year. It maintains a robust anti-corruption policy and reported zero disciplinary actions related to bribery. The report was submitted by Bindu Garg, Company Secretary & Compliance Officer.

Happy Forgings Limited has announced its audited standalone and consolidated financial results for the quarter and year ended March 31, 2026. The company reported a robust performance in Q4 FY26, driven by volume growth and healthy margin expansion across segments. The statutory auditors, S.R. Batliboi & Co. LLP, issued an unmodified opinion on the results.

Q4 FY26 Performance Highlights

During the quarter, the company registered a volume growth of 20.6% year-on-year, resulting in a revenue increase of 20.4% to ₹424 crore. EBITDA grew by 30.4% to ₹133 crore, while PAT increased by 23.6% to ₹84 crore. The management noted that PAT growth lagged EBITDA growth primarily due to adverse foreign exchange movements.

The quarter witnessed healthy margin expansion on both year-on-year and quarter-on-quarter bases. Gross margin, EBITDA margin, and PAT margin improved by 70 basis points, 240 basis points, and 50 basis points year-on-year, respectively. For Q4 FY26, the margins stood at 59.4%, 31.5%, and 19.7%.

FY26 Annual Results

FY26 marked a milestone year for Happy Forgings, with revenue for the year standing at ₹1,546 crore, a 9.8% increase from the previous year. The EBITDA margin expanded by 157 basis points to 30.4%, while the PAT margin improved by 52 basis points year-on-year to 19.5%. The company also reduced working capital intensity, reflecting continued improvement in operational efficiency and healthy cash flow conversion.

The company witnessed healthy traction across commercial vehicles, passenger vehicles, farm equipment, and industrial segments. This was supported by improving demand conditions and increasing value addition. Backed by strong customer engagement, the company is building a robust pipeline of incremental business across existing and new customers, including encouraging business wins in the exports segment.

Management Commentary and Outlook

Addressing shareholders in an earnings call, the management stated that the outlook for FY27 remains optimistic, with expectations of late-teen volume growth while maintaining EBITDA margins broadly in line with FY26 levels. The company expects to reduce its annual power cost significantly through the solar power initiative, with partial benefits starting from FY28.

The management highlighted a strategic shift in the business mix, targeting a reduction in commercial vehicle contribution to 27% from 37%, while increasing the share of industrials to 30%-31% from 14% and passenger vehicles to 10% from 6%. The company has an order book of ₹950 crores for new businesses, including heavy forgings for data centers, executable over the next 2.5 to 3 years.

Board Decisions and Corporate Actions

The Board of Directors, at its meeting held on May 21, 2026, approved the audited standalone and consolidated financial results for the quarter and year ended March 31, 2026. The board recommended a final dividend of ₹4 per equity share of face value ₹2 each for the financial year 2025-26, subject to shareholder approval.

Additionally, the board approved the enhancement of the solar power project capacity from 25 MW AC to 35 MW AC for captive consumption. The proposed investment for the project has been revised from ₹120 crores to up to ₹170 crores.