Quarterly Financial Results

HEG Reports Strong Q1 FY27 Performance; Standalone PAT Rises 53%, Composite Scheme Awaits NCLT Approval

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HEG Limited began FY27 with a strong financial performance, driven by continued momentum in its graphite electrode business.
On a standalone basis, revenue from operations increased 11.1% YoY to ₹680.91 crore, while Profit After Tax (PAT) surged 52.5% YoY to ₹109.50 crore.
On a consolidated basis, PAT from continuing operations grew 22.6% YoYto ₹122.34 crore.
The company also updated investors on its Composite Scheme of Arrangement, which is currently awaiting the final order from the National Company Law Tribunal (NCLT).

PRICE-SENSITIVE TRIGGER

Event: HEG Limited announced its unaudited standalone and consolidated financial results for Q1 FY27 and provided an update on the progress of its Composite Scheme of Arrangement involving HEG Graphite Limited and Bhilwara Energy Limited.

Type: Quarterly Financial Results

Impact: Positive

Immediate Effect: The company delivered double-digit revenue growth with significantly higher profitability, supported by strong performance in the graphite electrode segment. Management also confirmed that the Composite Scheme has received shareholder approvals and is awaiting the NCLT’s final order.

Metrics:

Standalone Financial Metrics:

Revenue from Operations: ₹680.91 crore (▲11.1% YoY)
Profit Before Tax (PBT): ₹151.79 crore (▲64.2% YoY)
Profit After Tax (PAT): ₹109.50 crore (▲52.5% YoY)
Basic & Diluted EPS: ₹5.67 (vs ₹3.72 in Q1 FY26)

Consolidated Financial Metrics:

Revenue from Continuing Operations: ₹680.79 crore (▲11.1% YoY)
Profit Before Tax (PBT): ₹165.08 crore (▲36.1% YoY)
Profit After Tax (PAT): ₹122.34 crore (▲22.6% YoY)
Basic EPS: ₹6.34 (vs ₹5.17 in Q1 FY26)

Balance Sheet Highlights:

Standalone Total Assets: ₹5,784.28 crore
Standalone Total Liabilities: ₹1,371.62 crore
Consolidated Total Assets: ₹6,333.97 crore
Consolidated Total Liabilities: ₹1,453.78 crore

Highlight:

HEG reported strong earnings growth in Q1 FY27, with standalone PAT rising over 52% and the graphite electrode business continuing to drive profitability through operational efficiency and improving market demand.

What Happened ?

HEG delivered a strong first quarter driven by healthy demand in its graphite electrode business and improved operational performance. Revenue grew by double digits while profitability expanded at a faster pace, reflecting cost optimization, manufacturing efficiencies, and disciplined execution.

Alongside the financial performance, the company updated investors on the progress of its Composite Scheme of Arrangement, under which its graphite business is proposed to be demerged into HEG Graphite Limited and Bhilwara Energy Limited is proposed to merge with HEG Limited. The scheme has already received shareholder approvals, and the NCLT has reserved its order after the July 2, 2026 hearing.

key details

Business & Operational Highlights:

Standalone revenue increased 11.1% YoY to ₹680.91 crore.
Standalone PAT grew 52.5% YoY to ₹109.50 crore.
Consolidated PAT increased 22.6% YoY to ₹122.34 crore.
Profit growth significantly outpaced revenue growth due to improved operating efficiency.
The graphite electrode segment remained the company’s primary earnings driver.

Segment Performance

Graphite Electrode Business:

The graphite electrode division continued to contribute the majority of the company’s revenue and profitability.

Segment Revenue: ₹677.77 crore (▲11.3% YoY)
Segment Profit: ₹149.64 crore, more than doubling compared to the corresponding quarter last year.
Improving demand across global steel markets supported higher profitability.
Continued emphasis on product quality and manufacturing efficiency strengthened competitive positioning.

Power Business:

The hydro power business remained seasonal during the quarter.

Segment Revenue: ₹3.14 crore
Generation remained limited during Q1 due to seasonal factors.
Production is expected to increase during the monsoon season in Q2 before tapering in Q4.

Composite Scheme of Arrangement:

HEG provided an update on its proposed corporate restructuring.

The scheme includes:

Demerger of HEG’s graphite business into HEG Graphite Limited.
Amalgamation of Bhilwara Energy Limited with HEG Limited.
Appointed Date: 1 April 2024.
Shareholders and creditors of both companies approved the scheme during meetings held on 5 May 2026.
Following the hearing on 2 July 2026, the National Company Law Tribunal (NCLT), Indore Bench, has reserved its order.
The scheme has not yet been given accounting effect pending receipt of the final NCLT order and other statutory approvals.

Note

The proposed restructuring is intended to separate the graphite business while integrating Bhilwara Energy Limited into HEG. Since the scheme is still awaiting regulatory approval, it has not affected the reported Q1 FY27 financial statements.

Risk Analysis

Summary:

Although HEG reported a strong quarter, future performance remains influenced by global steel production, graphite electrode demand, raw material availability, and completion of the proposed restructuring.

Key Risks:

Global steel industry demand remains cyclical.
Graphite electrode pricing may fluctuate depending on supply-demand dynamics.
Raw material cost volatility could affect margins.
The Composite Scheme remains subject to the NCLT’s final approval and other regulatory clearances.
Export demand could be influenced by international economic conditions.

Worst Case:

A slowdown in global steel production or delays in regulatory approval of the restructuring scheme could moderate earnings growth and postpone the strategic benefits expected from the corporate reorganization.

Risk Level: Medium

Company Commentary

According to Ravi Jhunjhunwala, Chairman, Managing Director & CEO:

HEG began FY27 on a strong note with 11% revenue growth and 23% growth in consolidated profit after tax.
Operational excellence, cost optimization, and disciplined execution contributed to improved profitability.
Management remains encouraged by the improving global demand environment for graphite electrodes.
The company continues to focus on manufacturing efficiency, customer relationships, sustainability, technology investments, and prudent capital allocation to create long-term shareholder value.

Official Exchange Filing: HEG Limited

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