On BSE, HEG shares hit a day-to-day high of Rs 1686.95, up 18.85%. In the last four trading days, the stock has gone up by 20.31 percent.
In an otherwise slow market the day before, shares of HEG Ltd, which makes graphite electrodes, jumped by 19%. During the session, the stock rose 18.85% on BSE to reach a 52-week high of Rs 1,686.95.
The stock has gone up 58.77% since the beginning of this year and has gone up 62.26% in a year. On BSE, a total of 2.06 million HEG shares were traded, bringing in Rs 32.08 crore. The company’s market value went up to Rs 6321.94 crore.
Technically, HEG’s relative strength index (RSI) was at 86.4, which means it was trading in the “overbought” zone. The one-year beta for HEG stock is 1, which means that it has been about as volatile as average during that time. The 5 day, 20 day, 50 day, 100 day, and 200 day moving averages are all higher than the price of HEG shares. The stock is now being followed by InCred Equities, which has given the stock a “add” call and set a target price of Rs 2462.
HEG is a good bet for the next year to 18 months because of several factors, including the beginning of the inventory cycle fall for US steel mills, the installation of additional EAF capacity in the US (11.45 mt), and HEG’s entry into producing graphite anodes for lithium-ion batteries. The firm said, “We value HEG at 1.8x P/BV, which is 0.5 SD above the historical mean of 1.3x. We will start to cover it with an ADD rating and a target price of Rs 2,462.”
In addition, HEG’s RoE is anticipated to increase from 8.6% in FY23 to 12.2% in FY25F, with a volume CAGR of 6% for the period of FY24F to FY26F. We have given the stock an ADD grade, with a forecast price of Rs 2,462 and a P/BV of 1.8x, which is 0.5 standard deviations (SD) above its historical mean of 1.3,” the report said.
For the fourth quarter that finished in March 2023, HEG’s total profit fell by 23%, from Rs 129.27 crore to Rs 99.72 crore. In the same quarter of the previous fiscal year, HEG made a net profit of Rs 129.27 crore. In the March quarter of 2023, the company’s income dropped by 8.35%, from Rs 673.06 crore to Rs 616.88 crore. EBITDA dropped by 21.31%, from Rs 156.89 crore in the March quarter of 2022 to Rs 123.45 crore in Q4.
For the fiscal year that ended in March 2023, the net profit was Rs 532.36 crore, up 23.50% from Rs 431.05 crore for the fiscal year that ended in March 2022. In the fiscal year that finished in March 2023, sales went up by 12%, from Rs 2201 crore to Rs 2467 crore.
HEG makes graphite electrodes, which are used as raw materials in the EAF route to make steel, which is much less harmful (emissions are cut by three-quarters) than the more standard BF route.