Key highlights from HEG Limited (HEG) Q4 FY22 Earnings Concall
Q&A Highlights:
Sonali Salgaonkar – Jefferies – Analyst
- Quantum of price hikes between 3Q and 4Q and any price hike from April 1 until now?
Ravi Jhunjhunwala – Managing Director
- Between 3Q and 4Q it’s 12% and expecting to add 4-5% QonQ.
Sonali Salgaonkar – Jefferies – Analyst
- Current inventory levels of electrodes?
Ravi Jhunjhunwala – Managing Director
- HEG is working at very low inventory levels.
- Normal is a month, but HEG is working at less than that.
- Has no excess inventories with customers or suppliers.
Sonali Salgaonkar – Jefferies – Analyst
- HEG’s key export geographies?
Ravi Jhunjhunwala – Managing Director
- It’s Americas, followed by Middle East, Southeast Asia, Europe and a little bit to African countries.
Sonali Salgaonkar – Jefferies – Analyst
- Of the 30-35 million new EAF steel production, where is it coming from?
Ravi Jhunjhunwala – Managing Director
- About 15-20 million in Americas and rest in Europe.
Sonali Salgaonkar – Jefferies – Analyst
- What portion of INR12 billion is spent and how much is left for investment?
Ravi Jhunjhunwala – Managing Director
- INR800 crores is already spent and INR400 crore remains to be spent until December.
Abhijeet Dey – Equentis Wealth – Analyst
- Expected price increases in needle coke over the next two quarters?
Ravi Jhunjhunwala – Managing Director
- If graphite prices go up, needle coke prices will follow. There would be only a couple of quarters lag.
Pranav Jain – HDFC securities – Analyst
- Production and sales volume for 4Q22 and FY22?
Ravi Jhunjhunwala – Managing Director
- HEG is at 90% capacity utilization.
- Can’t give exact production and sales numbers.
Rajesh Agarwal – Moneyore – Analyst
- Did HEG had volume growth in Q4 and when will capacity come online?
Ravi Jhunjhunwala – Managing Director
- The 4Q volume growth was same as 3Q.
- For new volumes to come in, it will be in 1Q calendar year 2023.
- Should be doing 7-8% more volume in CY1Q23 than last year.
Dewang Sanghavi – ICICI Securities – Analyst
- Is there’s any demand impact due to recent export duty on steel export?
Ravi Jhunjhunwala – Managing Director
- It’s a dampener for the steel customers.
- This duty seems temporary.
- HEG exports two-thirds to 40 countries and so won’t see much impact.