Harsha Engineers International Target Price Revised to Rs 461 by Prabhudas Lilladher

Harsha Engineers International Reports Strong Quarter, Raises FY27-28 EPS Estimates

Prabhudas Lilladher's research report on Harsha Engineers International has revised its FY27-28 EPS estimates by +3.1%/ +6.5%, factoring in utilization improvement in Advantek and recovery in export business (ex-Romania).

Harsha Engineers International reported a strong quarter with a 27.1% year-over-year (YoY) revenue increase and a sharp 606bps YoY EBITDA margin expansion to 15.5%, primarily driven by operating leverage. The company guided for double-digit consolidated revenue growth in FY27, with India Engineering expected to sustain mid-teen growth led by industrial, automotive, and export demand.

Export momentum improved meaningfully across Europe and the US, aided by recovery in industrial activity, lower US import tariffs, and increasing wallet share gains with existing customers. Advantek continued to scale up well with improving utilisation at the Bhayla facility, while the planned 2-phase expansion is expected to support the next leg of growth. Romania losses narrowed during FY26 vs FY25, with the turnaround strategy focused on higher share of cages and operational efficiencies, although weakness in the European wind market remains a near-term overhang.

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The China brownfield expansion remains on track for H2FY28 commissioning and is expected to improve localisation, product mix, and profitability. Growth drivers across bushings, large-size cages, and stampings continue to remain strong, supported by customer additions, wider applications, and rising industrial demand, while Solar EPC is expected to sustain robust growth momentum.

Market Valuation

The stock is currently trading at a price-to-earnings (P/E) ratio of 22.2x/19.0x on FY27/28E earnings. Prabhudas Lilladher has rolled forward to Mar'28E and maintains a 'HOLD' rating with a revised target price (TP) of INR461 (INR409 earlier), valuing the company at a P/E of 20x Mar'28E (20x Sep'27E).

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Note: The table above presents a comparison of Harsha Engineers International's revenue growth and EBITDA margin for the current quarter and forecasted growth for FY27 and FY28.