🔷️2017 – 2018 star performer HEG & GRAPHITE INDIA are falling from last few session.
🔷️HEG IS DOWN 55% From 52 week high of 4955 currently trading around 2200.stock has hit new 52 week LOW.
🔷️GRAPHITE INDIA stock has also corrected 58% From 52 week high of 1127 and currently Hit New 52week LOW of 476.
🔷️Steel as a sector is not doing well globally.
There are expectations that graphite electrode (GE) margins may face double whammy of price decline and cost increase over the next two to three quarters.
🔷️ GE margins to fall from $9,000-10,000 per tonne in FY19E to around $7,000 per tonne in FY20E. There are high chances of EPS cut from FY19-21E EPS by 10% To 20% for GE Twins.
🔷️HEG & GRAPHITE INDIA are manufacturers of graphite electrodes which are key components of electric arc furnaces that turn scrap into steel. Both the companies produce two grades of graphite electrodes, High Power and Ultra High Power, which are manufactured according to the customers’ needs and requirements.
🔷️Chinese-made high-performance graphite electrode materials are also starting to be accepted by the industry, and that’s putting price pressure on all global electrode makers.
🔷️HEG to announce its Fy19Q3 numbers on 12th FEB’19.Revenues can be down 7% to 9% and Profits can be effected to the tune of 20% To 22% as per our estimates.
And Even Graphite India Revenue and Profits can be impacted 20% to 25%
🔷️Both Stocks has broken major support levels and there can be fresh leg of Downfall.Technically Both stocks are oversold and there can be some Retracement or bounce.
🔷️Stock can find value buying only after how RESULTS panout and it can take few Qtrs to things to get stablise.
Disc – All views expressed are for personal and for Educational & Study purpose only. Consult your financial advisor before investing or taking any position.
4 thoughts on “WHY HEG & GRAPHITE INDIA STOCKS ARE FALLING FROM PAST FEW DAYS.”
What is the support level of graphite india & heg and can it bounce back up to 730 level & 3250 level in near term. Please give the level for bounce back and exist level for near term.
Resistance at 620-640
Support 2000 /1500
Market would watch Results of HEG to get a clue about future EAF Industry
Graphite Results saw degrowth QoQ which markets r trying to discount currently.
Charts Work Best on FO stocks or with very liquid counters.. These kind of stocks are purely News based and Sentiment based Along with Fundamentals. Fundamentally Raw Material cost for Graphite has increased n volume Has decreased due to Sanctions on Iran. Near term it will not cross the levels of 750 or 3250 unless HEG post a Good results and Surprises Dalal Street or China Implemens more Restrictions on Old steel industry or US China Trade was Ends.
HEG SUPPORT – 2000-1900
GRAPHITE SUPPORT – 460-420
LEVELS TO WATCH ON UPPER SIDE FOR FRESH RALLY
HEG – 2700-2750
GRAPHITE – 550-600
keep strict S/L as per Risk