Posted on March 26, 2025, by Niftynews
In a remarkable move, shares of HEG and Graphite India Ltd. have surged by as much as 20% over the past two days, capturing the attention of investors and analysts alike. This rally comes on the heels of positive news surrounding the graphite electrode market, driven by a price hike from Chinese manufacturers and Japan’s imposition of an anti-dumping duty on Chinese graphite electrode exports.
Why Are HEG and Graphite India Stocks Surging?
HEG’s share price saw a notable increase of 7% to ₹516.20 on March 26, 2025, during intraday trading, with the stock rising 20% in just two days. This surge follows reports that Japan will implement a 95.2% anti-dumping duty on China’s graphite electrode exports for four months, effective from March 29, 2025. Additionally, Chinese manufacturers have already raised prices for high-power (HP) graphite electrodes, which is expected to significantly impact the domestic market.
In a market that is generally subdued, HEG’s price movement stands out. With over 13.85 million shares, or 7.2% of its total equity, traded on the BSE and NSE, the company has seen strong investor interest. The stock reached a 52-week high of ₹619.25 on December 5, 2024.
Similarly, Graphite India has also seen significant gains, with its stock rising by 4% to ₹514.85 on March 26, 2025. Over the past two days, Graphite India shares have gained a remarkable 12%, underscoring the strong momentum in the graphite electrode market.
What’s Behind the Price Surge?
The price surge can be attributed to two key factors. First, the Japanese government’s imposition of a steep anti-dumping duty on Chinese graphite electrode exports. While the duty will be a short-term measure, it has drawn significant attention to the sector, particularly in India, where companies like HEG and Graphite India are well-established players in the graphite electrode market.
Second, the price hike by Chinese manufacturers for high-power graphite electrodes is expected to push domestic HP electrode prices up by approximately 7%. This is a significant development for HEG, which exports nearly 70% of its production and derives 33% of its total revenue from the Indian market. The price hike is likely to benefit both HEG and Graphite India, as they supply these high-demand products within the domestic market.
Graphite Electrode Industry Outlook
The long-term outlook for graphite electrode manufacturers like HEG and Graphite India remains positive, despite some short-term pressures. HEG has been the world’s largest single-site graphite electrode plant, with a production capacity of 100,000 tons per annum, and it remains optimistic about future growth in the sector.
One major driver of this optimism is the ongoing global push for decarbonization in the steel industry. As Electric Arc Furnace (EAF) steelmaking technology becomes more widely adopted, the demand for graphite electrodes is expected to rise. According to HEG’s Q3 investor presentation, this trend could add approximately 200,000 tons of demand for graphite electrodes by 2030, excluding China.
Graphite India shares the same view, with Chairman K.K. Bangur highlighting that increasing steel consumption in sectors like infrastructure, automotive, and construction will drive the demand for graphite electrodes in the long term.
What This Means for Investors
The positive outlook for HEG and Graphite India suggests strong potential for growth in the coming years. Despite short-term fluctuations, the increasing demand for graphite electrodes—driven by the decarbonization of steel production and the adoption of more energy-efficient technologies—provides a solid foundation for both companies.
Investors looking for long-term gains in the graphite electrode market may want to closely monitor developments in this sector. The rally in HEG and Graphite India shares serves as a clear indication of the market’s confidence in the future of these companies.
Conclusion
HEG Ltd. and Graphite India Ltd. have been on an impressive rally, with their stock prices surging by up to 20% in just two days. Positive news, including Japan’s anti-dumping duty on Chinese graphite electrodes and price hikes from Chinese manufacturers, is driving this momentum. Additionally, the long-term growth prospects for the graphite electrode market—fueled by global decarbonization trends in the steel industry—are likely to support further growth for these companies. Investors looking to capitalize on the surge in graphite electrode demand may find HEG and Graphite India to be promising opportunities.