Graphite India Ltd share Price Today

Graphite India (GIL) is the largest Indian producer of graphite electrodes by total capacity. Its manufacturing capacity is 98000 tonnes per annum.

• While GIL manufactures a full range of graphite electrodes, it stays focused on the higher margin, large diameter, ultra-high power (UHP) electrodes
• GIL has over 40 years of technical expertise in the industry

Graphite India reported a muted Q3FY23 performance on account of subdued capacity utilisation levels during the quarter.

• For Q3FY23, consolidated capacity utilisation was at 42% compared to 90% in Q3FY22 and 56% in Q2FY23. On the back of lower-than-expected capacity utilisation, consolidated topline came in lower than our estimate. For Q3FY23, GIL reported a consolidated topline of ₹ 701 crore, down 15% QoQ, lower than our estimate of ₹ 1001 crore

 

• Consolidated EBITDA for the quarter was at ₹ 72 crore, down 29% QoQ. Consolidated EBITDA margin for the quarter was at 10.3% compared to 12.4% for Q2FY23

 

• During the quarter, consolidated other income was at ₹ 33 crore, down 50% YoY, 70% QoQ. Ensuing consolidated PAT for the quarter was at ₹ 53 crore

Industrial goods company Graphite India announced Q1FY24 results:

• Consolidated Q1FY24:
  • Net sales of Rs 747 crore, a decline of 13.7% YoY and 8.3% QoQ
  • EBITDA of Rs (13) crore as compared to Rs 59 crore in Q1FY23
  • Net loss of Rs 30 crore as compared to Net Profit of Rs 24 crore in Q1FY23
  • EPS of Rs (1.56) per share
  • Gross debt of Rs 360 crore
  • Cash (net of gross debt) of Rs 2,115 crore
• Standalone Q1FY24:
  • Net sales of Rs 720 crore, a decline of 9.8% YoY and 1.0% QoQ
  • EBITDA of Rs (14) crore as compared to Rs 97 crore in Q1FY23
  • Net loss of Rs 27 crore as compared to Net Profit of Rs 63 crore in Q1FY23
  • EPS of Rs (1.39) per share
  • Gross debt of Rs 280 crore
  • Cash (net of gross debt) of Rs 1,942 crore

K K Bangur, Chairman, Graphite India, said, "In Q1FY24 Graphite India registered Consolidated Net Sales of Rs 747 crore, a decline of 13.7% YoY and a decline of 8.3% on QoQ basis. Operating EBITDA was Rs (13) crore after the provision of inventory write-down of Rs 157 crore which resulted in a Net Loss of Rs 30 crore. The standalone capacity utilization during the quarter was 67% as compared to 80% in Q1FY23. This quarter’s financial results were impacted due to a decline in both realization and volume.

Globally, there has been a 1.7% decline in YoY steel production, mainly attributed to subdued demand for electrodes. This has led to reduced capacity utilization and pricing pressures across the industry. Despite this trend, India has displayed resilience, achieving a substantial 7.8% YoY growth in its steel output during Q1FY24. However, the increased availability of imported graphite electrodes has impacted domestic demand and pricing. Raw Material price correction was not aligned with the fall in electrode price impacting operating margins.

Higher government spending on infrastructure and increased traction of EAFs in the steel industry will drive medium to long-term growth in coming quarters. Stringent emission regulations enforced by the governments globally are compelling the steel industry to seek the more efficient EAF steelmaking technology, will positively impact the demand for graphite electrodes going forward.

From a balance sheet perspective, we maintain a strong consolidated Net Cash position of Rs 2,115 crore at the end of June 2023. We are pleased to announce that on August 07, 2023, Graphite India sold its land in Bengaluru for a cash consideration of Rs 986 crore, which was received in a single tranche. This will be reflected in our H1FY24 Net Cash position.

Overall, Graphite India's outlook on the electrode industry's future remains positive. We continue to adopt efficient operational practices and exercise prudent financial management."

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