HEG (HEG) Q4 25/26 earnings summary

Executive summary

• Achieved strong year-over-year growth in sales volume and revenue, with total income rising to ₹2,660 crore and EBITDA of ₹497 crore for FY26.

• Maintained high operational efficiency with capacity utilization above 90% and completed expansion to 100,000 tons, targeting 115,000 tons by 2028.

• Q4 FY26 saw a net loss of ₹163 crore, mainly due to unrealized losses from fair valuation of investments and rupee depreciation, but underlying operating margins remained stable.

• Board recommended a final dividend of ₹3.4 per equity share for FY 2025-26.

• Audited standalone and consolidated financial results for FY26 were approved, with unmodified audit opinions issued by statutory auditors.

Financial highlights

• Revenue increased from ₹2,153 crore to ₹2,569 crore year-over-year, with EBITDA margin improving to 19% and PAT margin to 7%.

• Standalone net profit for FY26 was ₹141.25 crore, consolidated net profit at ₹207.25 crore; consolidated profit for FY26 was ₹338.9 crore.

• Q4 FY26 saw a standalone net loss of ₹163 crore, mainly due to mark-to-market losses on investments, especially in Graftech International Limited.

• Investments (including cash) stood at ₹1,155 crore as of March 31, 2026; treasury of ₹792 crore.

• Short-term borrowings reduced to ₹494 crore by March 31, 2026, from ₹793 crore a year earlier.

Outlook and guidance

• EBITDA margin guidance for FY27 and FY28 is above 20%, with continued high utilization and resilient margins expected.

• Global steel demand is expected to rebound in 2027 after a soft 2025, with India leading growth.

• Ongoing geopolitical conflicts and rising input costs are expected to pressure margins, necessitating price increases.

• Long-term demand outlook for electrodes remains strong due to global shift to electric arc furnace steelmaking.

• The company continues to monitor regulatory developments, especially regarding new labour codes and their impact on employee benefits.