Happy Forgings signs a long-term supply deal, increasing production with its new forging facility.
12 Feb 2025 | 1291 Views | By Angitha Suresh
Happy Forgings Limited (HFL) has entered into a Memorandum of Understanding with a global manufacturer of industrial and construction equipment for the long-term supply of heavy forged and precision-machined components. The agreement, announced in Ludhiana on February 12, 2025, paves the way for a binding supply contract expected to commence ...
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Happy Forgings Limited (HFL) has entered into a Memorandum of Understanding with a global manufacturer of industrial and construction equipment for the long-term supply of heavy forged and precision-machined components. The agreement, announced in Ludhiana on February 12, 2025, paves the way for a binding supply contract expected to commence in 2028.
The customer has committed an initial investment of INR 20 crore for tooling and development, with component testing scheduled for 2027. Once operational, the supply contract is projected to generate annual revenues of INR 95 crore based on minimum committed volumes, with potential to reach INR 160 crore depending on equipment sales.
The components, weighing up to 1,000 kilograms each, will be manufactured at HFL's new heavy forging facility, which is being established under a recently approved capital expenditure plan of INR 650 crore. The facility will expand HFL's capabilities to produce forged components exceeding 250 kilograms.
Managing Director Ashish Garg stated that the agreement provides visibility for the deployment of their new heavy forging capacity and demonstrates the company's engineering expertise. The move into heavier components aligns with HFL's strategy to diversify its portfolio and enhance profitability.
Happy Forgings Limited, established in 1979, has grown to become one of India's major manufacturers of forged and machined components for the automotive, industrial, and infrastructure sectors. The company supplies to domestic and international markets, with manufacturing facilities located in Punjab. The expansion into heavier components represents a significant step in the company's evolution from its traditional focus on automotive components.
The global market for heavy forged components has seen steady growth, driven by increasing industrialization and infrastructure development. Industry analysts estimate the sector to be worth approximately USD 50 billion annually, with demand particularly strong in mining, construction, and heavy machinery sectors.