HEG, Graphite India zoom up to 18% on heavy volumes in weak broader market

Japan's cabinet has decided to impose provisional four-month anti-dumping duties on China's graphite electrode exports, effective March 29, according to reports

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Shares of graphite electrodes companies HEG and Graphite India have rallied by up to 18 per cent on the BSE in Tuesday’s intra-day trade amid heavy volumes in an otherwise weak broader market. In comparison, the BSE Midcap and BSE Smallcap index were down 1 per cent.

 

HEG share price soared 18 per cent to ₹504 on the back of an over 10-fold jump in trading volumes. At 02:14 pm, the stock was trading 17 per cent higher at ₹504 on the BSE. A combined 25.54 million shares, representing 13.2 per cent of the total equity, of HEG have changed hands on the NSE and BSE. 

 

Graphite India share price surged 14 per cent to ₹525 on the back of a 16-fold jump in average trading volumes. A combined 19.75 million shares, or 10.1 per cent of total equity, of Graphite India have changed hands on the NSE and BSE. 

 

Graphite India is mainly engaged in the business of manufacturing and selling of graphite and carbon and other products.  ALSO READ | Stock Market LIVE Updates: Sensex 150 pts higher at 78,140; Nifty at 23,700

 

HEG has been the world’s largest single site graphite electrode plant under one roof with a capacity of 80,000 tons per annum for a long time. The company recently completed its expansion to 100,000 tons to become the third largest producer of Graphite electrodes in the western world. It has been exporting approximately 65 – 70 per cent of its production to about 35 countries around the world consistently for more than 20 years.

 

According to a Reuters report, Japan’s cabinet has decided to impose provisional four-month anti-dumping duties on China’s graphite electrode exports, effective March 29.

 

The measure comes after a Japanese government probe concluded in its interim report that China was exporting graphite electrodes, an industrial material used in electric arc furnace steelmaking, at unfairly low prices and causing damage to Japanese companies, the news agency reported quoting public broadcaster NHK.

 

Regarding the industry's outlook, HEG, in a Q3 investor presentation, said the decarbonisation push in the steel industry is expected to boost demand for graphite electrodes, as the adoption of Electric Arc Furnace (EAF) steelmaking expands globally. This transition is projected to create an additional demand of approximately 200,000 tons by 2030 (excluding China).  ALSO READ | IndusInd Bank slips 5% ahead of accounting discrepancies report on Mar 28

 

Despite short-term pressures, decarbonisation is now an irreversible trend, and HEG remains optimistic about the long-term growth potential for graphite electrode demand.

 

As global decarbonisation efforts make headway, the demand for graphite electrodes will increase going forward. Rising steel consumption, particularly in infrastructure, automotive and construction will further support long-term growth potential for graphite electrode manufacturers. The management’s strategic focus continues to be on investing in technological advancements and sustainability initiatives to drive long-term value creation, said K K Bangur, Chairman of Graphite India in the Q3 earnings release.