Company Overview

HEG Limited (BSE: 509631, NSE: HEG) reported outstanding financial performance for FY 2025-26, with significant growth across both standalone and consolidated metrics. The company announced its 54th Annual General Meeting scheduled for July 29, 2026, along with comprehensive strategic developments including a major demerger plan.

Financial Performance

HEG delivered robust results with standalone revenue growing 19.3% to ₹2,568.50 crore from ₹2,152.71 crore in FY25. Standalone net profit surged 78.4% to ₹180.72 crore (from ₹101.31 crore), while consolidated net profit showed exceptional growth of 197% to ₹341.37 crore (from ₹115.06 crore). The company maintained strong operational metrics with 90% capacity utilization despite challenging global steel market conditions.

EBITDA improved significantly to ₹497 crore with margins expanding to 19% from 17% in the previous year. Basic EPS stood at ₹9.36 compared to ₹5.25 in FY25. The company maintained a debt-free position with a substantial treasury balance of ₹792 crore as of March 31, 2026.

Strategic Demerger and Corporate Restructuring

The Board approved a composite scheme of arrangement to demerge into two listed entities: HEG Graphite Limited (focusing on core graphite electrode business) and HEG Greentech Limited (focusing on energy transition businesses including battery anode materials, 278 MW hydropower assets, BESS EPC scaling to 6 GWh, and Solar + BESS IPP solutions).

The scheme received stock exchange approvals from BSE (January 8, 2026) and NSE (January 9, 2026), with NCLT filing completed on January 24, 2026. Stakeholder meetings are scheduled for May 5, 2026, with an appointed date of April 1, 2024.

Capital Management and Dividend

The Board recommended a final dividend of ₹3.40 per share (170%) for FY26, subject to shareholder approval at the AGM. The record date is set for July 22, 2026, with payment within 30 days from the AGM date.

Operational Highlights and Expansion Plans

HEG operates the world's largest single-site graphite electrode plant with 100,000 tonnes capacity. The company announced a brownfield expansion plan to increase capacity to 115,000 tonnes with ₹650 crore capex, expected to commission in Q1 calendar year 2028. The expansion leverages existing nipple capacity and the company's lowest cost quartile position.

Subsidiaries and Associates Performance

  • TACC Limited: Provided corporate guarantees of ₹1,230 crore for SBI facilities, with ₹400 crore OCD subscription by HEG
  • Bhilwara Energy Limited (45.62% associate): Reported consolidated turnover of ₹909.66 crore and net profit of ₹243.22 crore, with HEC extending ₹210 crore loans during the year
  • Bhilwara Infotechnology Limited: Acquired additional 61.41% equity interest in December 2024, increasing holding to 100%
  • HEG Graphite Limited: No operations in FY26, prepared for demerger

Industry Context and Outlook

Global crude steel production declined 2.0% YoY to 1,849.4 million tonnes in 2025, with China production down 4.4% while India production grew 10.4%. Electric Arc Furnace adoption remains at ~29% globally and ~20-21% in India. The outlook remains positive with 100+ million tonnes of new EAF capacity announced globally ex-China, expected to drive incremental electrode demand of 190,000-200,000 MT by 2030.

Corporate Governance and Compliance

The company faced some regulatory challenges including SEBI penalties of ₹1,01,480 each by BSE and NSE for director age regulation violation, and four instances of insider trading violations in Q3 FY26 involving promoter group members. However, the auditor issued an unqualified opinion on financial statements, confirming adequate internal financial controls and compliance with accounting standards.

Forward Outlook

HEG is positioned to benefit from global energy transition trends, EAF adoption growth, and its strategic demerger that will unlock value in both traditional graphite electrode business and emerging green energy technologies. The company's strong financial position, zero debt, and expansion plans provide a solid foundation for future growth.