As per CNBC-TV18 news reports, HEG Ltd.’s planned demerger has reached the SEBI approval stage. The demerger was first announced in May 2024 and is expected to be completed by the end of 2025 or early 2026.
In Q4 FY25, HEG reported a ₹73 crore loss. However, this was mainly due to a mark-to-market loss on HEG’s 10% stake in its competitor GrafTech. Operationally, this has been one of the best quarters for the company, whereby EBITDA margins rose substantially.
Excluding the investment-related loss, HEG’s EBITDA margin in Q4 FY25 stood between 24%. The company is confident that this margin range will be maintained in the next two quarters even without any price hike. It also believes that the demand for electrodes is recovering steadily. It expects prices to increase by 15–20% by the end of 2025.
HEG met its volume target of 80,000 tonnes in FY25 and aims to produce 85,000 tonnes in FY26. The company benefits from its large facility in India, which has a capacity of 100,000 tonnes under one roof. This scale helps HEG remain cost-efficient, especially when compared to smaller, high-cost plants run by global competitors.
At 10:22 AM, the HEG share price was up 1.07% and was trading at ₹499.75.
Demand for graphite electrodes remains weak globally, with around 500,000 tonnes of estimated demand against a supply of 630,000 tonnes. However, the company believes that the demand will rise as steel production improves.
As per CNBC-TV18 news reports, the senior management at HEG Ltd is excited about the emergence of new business opportunities after a major supply correction. Recently, over 120,000 tonnes of global capacity have been shut down by firms like Resonac, GrafTech, and Tokai. These shutdowns represent an 18.5% cut in the industry’s capacity and are expected to help improve market balance.
Despite short-term challenges, HEG is excited about the possibilities for future growth. The upcoming demerger, stable margins, and capacity advantages are creating an optimistic picture as the market begins to recover.
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Published on: May 21, 2025, 10:42 AM IST
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