HEG (HEG) Q3 25/26 earnings summary

Executive summary

• Global steel production declined 2% year-over-year in 2025, with China down 4.4% and India up 10.4% due to strong infrastructure and automotive demand.

• Achieved consolidated revenue of ₹656.3 crore in Q3 FY26, with profit before tax at ₹246.2 crore, up from ₹118.6 crore in Q3 FY25, reflecting strong operational performance and improved margins.

• Board approved unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025.

• Exports comprised about two-thirds of total sales, reaching over 30-35 countries and including top 20 global steel companies.

• Appointment of Salil Bawa as President - Investor Relations and Senior Management effective February 10, 2026.

Financial highlights

• Nine-month revenue ended December 2025 was INR 1,965 crore, up from INR 1,616 crore year-over-year; Q3 FY26 revenue was INR 656 crore.

• Standalone net profit for Q3 FY26: ₹141.25 crore (up from ₹130.86 crore in Q2 FY26; up from ₹98.32 crore in Q3 FY25); consolidated net profit for Q3 FY26: ₹206.97 crore (up from ₹143.33 crore in Q2 FY26; up from ₹83.40 crore in Q3 FY25).

• EBITDA margin improved to 32% in Q3 FY26 from 28% in Q2 FY26 and 23% in Q1 FY26.

• Standalone profit after tax for nine months was INR 344 crore, up from INR 163 crore; consolidated profit after tax was INR 455 crore, up from INR 189 crore.

• Maintained a treasury balance of INR 1,155 crore and remains long-term debt-free.

Outlook and guidance

• Global transition to electric arc furnace (EAF) steelmaking is expected to add 200,000 tons of incremental graphite electrode demand by 2030 (excluding China).

• 20 million tons of new EAF capacity added in 2024-2025; another 60 million tons expected by 2028, and 30 million tons by 2030.

• Announced further expansion to 115,000 tons capacity by end of 2027; construction of a 15,000-ton capacity expansion is on track for completion by early 2028.

• Realizations for graphite electrodes are expected to remain stable for the next two quarters.

• Short-term market pressure persists due to weak global steel production, keeping graphite electrode demand and spot prices under pressure.