India: HEG Profit Increases 680% in Q2 on Higher Graphite Electrode Prices
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Indian graphite electrode maker HEG today reported a net profit of INR 889 crore ($120 Mn) during the quarter ended Sept 30, 2018.
HEG Chairman, Mr. Ravi Jhujhunwala attributes this growth to rising demand from China and ongoing consolidation in the Indian steel industry.
"We continue to experience robust demand for electrodes on the back of strong growth in global EAF steel sector. In addition, the Indian steel industry expanded by 6.1 percent in the first nine months of the year. Moreover, the ongoing consolidation in Indian steel capacity and higher production from under-utilized steel assets is also fueling fresh demand for electrodes.''
China continues to cut steel production through the traditional blast furnace route in 28 main cities even as it boosts local EAF capacity. Global EAF capacity, ex-China, seen growing 11-12% in 2018. Both fueling demand for graphite electrodes, he further added.
Key Q2 Earnings Highlights (YoY)
. Revenue up 338% to Rs. 1,794 crore as against Rs. 410 crore in Q2FY18
. Q2 EBITDA stood at Rs. 1,389 crores as against Rs.192 crore in the corresponding quarter in the year-ago period
. EBITDA margins stood at 77% as against 47% in Q2FY18
. PAT up by 680% to Rs. 889 crore as against Rs. 114 crore in Q2FY18 and Rs.-8.43 crores in Q1FY18.