Graphite Electrode : Graphite India/HEG

(vivekchoraria) #85

Graftech in its prospectus has also said that demand from this year is expected to go up by 100000 tonnes from this year on account of new EAF capacities getting commissioned in China. The increased supply will get absorbed if the numbers are to be believed.

(shreys) #86

In my opinion,
requisite adjustments should be made for purchasing power parity.
For Graftech’s valuation of around 3.5 Billion $-
Considering 1$= 12 Rs
Graphite India’s market capitalisation should be around 4000 Crores.

Considering 1$=20 Rs
Graphite India’s valuation should be around 7000 crores

Considering 1$=30 Rs
Graphite India valuation should be around 10000 crores.
Post adjustment for PPP Graphite India seems to be very fairly valued.

(phreak) #87

A commodity company that has ‘x’ capacity for ‘X’ product should be valued same regardless of PPP, as long as commodity price is same in both countries and its a global market with global supply-demand. PPP is already in the price of commodity where a low cost producer can flood the market and thereby affect a high-cost producer in a developed country. What we should be considering is only the capacity. If anything, I would think the capacity in developing country should be more expensive and not cheap since its going to be cheaper to run relatively and should have higher margins consequently for the same price of commodity.

(shreys) #88

Many thanks for the explanation. It’s much appreciated

(sunilgct) #89

(Gaurav Agarwal) #90

China steel capacity replacements continue in 2018 with more electric arc furnaces

(VP_amit) #91

From ICICIdirect report on - expected FY 18 Q4 performance of HEG and GI:

Graphite electrode players to report yet another stellar quarter…
We expect HEG, Graphite India to report a robust performance driven
by higher realisations. HEG’s topline is likely to increase 314.2% YoY,
26.7% QoQ while Graphite India’s topline is expected to increase
214.2% YoY and 25.7% QoQ. Higher realisations are expected to more
than offset the increase in raw material cost (needle coke). Thus, we
expect HEG and Graphite India to report EBITDA margins of 60.7% and
52.2%, respectively

  • So expected PAT (Q4) for HEG 434 crores, up 26.9% QoQ, with a rough TTM PE of 13 at CMP
  • expected PAT for GI (Q4) 413 crores, up 21.3% QoQ, with a rough TTM PE of 16 at CMP

(vivekchoraria) #93

this is graftech’s pre ipo management roadshow… very informative and concise

(sunilgct) #94

The link does show blank despite registration . can you paste the screenshot or check the link and update

(vivekchoraria) #95

(vivekchoraria) #96

this is what i get when i click on the link…then just click on " management roadshow presentation ".

it is working for me.