Q3 2025 HEG Ltd Earnings Call Transcript
Key Points
- HEG Ltd (BOM:509631) achieved a high capacity utilization rate of 80% at its expanded plant capacity of 100,000 tonnes, maintaining efficiency despite market challenges.
- The company remains the lowest cost producer of graphite electrodes globally, even after expansion, which positions it well against competitors.
- HEG Ltd (BOM:509631) is debt-free with a substantial treasury size of nearly INR1,000 crores, providing financial stability and flexibility.
- The company recorded a significant increase in EBITDA to INR194 crores in Q3 FY25 from INR110 crores in the same quarter of the previous year, indicating improved operational performance.
- HEG Ltd (BOM:509631) is optimistic about medium to long-term industry prospects due to the global shift towards decarbonization and the rise of electric arc furnaces, which could boost demand for graphite electrodes.
- Global crude steel production declined by 0.8% in 2024, impacting graphite electrode demand, particularly outside China.
- Electrode pricing remains under pressure due to subdued demand, which, coupled with stable needle coke prices, has narrowed profit margins.
- The demerger process of the anode business has been delayed by about two months, affecting strategic timelines.
- HEG Ltd (BOM:509631) faces potential challenges from reciprocal duties discussed by the US, which could impact export margins.
- The company has not yet implemented a price increase despite competitors announcing hikes, which could affect competitive positioning if market conditions do not improve.
Ladies and gentlemen, welcome to HEG Limited's Q3 FY25 results conference call organized by SKP Securities Limited. (Operator Instructions) Please note that this conference is being recorded.
I now hand the conference over to Mr. Navin Agrawal, Head, Institutional Equities at SKP Securities Limited. Thank you, and over to you, sir.
Good afternoon, ladies and gentlemen. I'm pleased to welcome you on behalf of HEG Limited and SKP Securities to this financial results conference call with the leadership team at HEG Limited. We have with us Mr. Ravi Jhunjhunwala, Chairman, Managing Director, and CEO; and Mr. Riju Jhunjhunwala, Vice Chairman; along with their colleagues, Mr. Manish Gulati, Executive Director; Mr. Om Prakash Ajmera, Group CFO; Mr. Ravi Tripathi, CFO; and Mr. Puneet Anand, CSO. We'll have the opening remarks from Mr. Jhunjhunwala, followed by a Q&A session. Thank you, and over to you, Ravi-ji.
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