HEG Ltd. — Interim / Quarterly Report 2019

Feb 15, 2019

HEGISECTT12019 15th February, 2019

	BSE Limited	2	National Stock Exchange of India Limited
	25th Floor, P JTowers	1	Exchange Plaza, 5th Floor
	Dalal Street	I	Plot No.e/l, G Block, Bandra -Kurla Complex
	MUMBAI - 400001.		I Bandra (E),
	____
L ___JI	Scrip Code: 509631	I	--'-.--'._--'"______________I ~~~~~!~~EOl.

Sub: Investors presentation on the Unaudited Financial Results of the Company for the Q3 of FY 2019.

Dear Sir,

Please find enclosed a copy of Investors Presentation on the Unaudited financial results of the Company for the Q3 of FY 2019 for your information and record please.

Thankin8 you,

Yours faithfully, For HEG LIMI ED HAUDHARY) ANY SECRETARY

he8·investor@lnjbhilwara.com

F;ncl : as above

Corporate Office: Regd. Office: Noida- 201 301 (NCR-Delhi), India (Madhya Pradesh), India Fax: +91-120-4277841 Fax: +91-7480-233522 Website : www. Lnjbhilwara.com Website: www.hegltd.com

HEG LIMITED

Bhilwara Towers, A-12, Sector-1 Mandideep (Near Bhopal) Dislt. Raisen 462046 Tel. : +91-120-4390300 (EPABX) Tel. : +91-7480-405500, 233524 to 233527 Corporate Identification No.: L23109MP1972PLC008290

8

PROUD TO BE INDIANPRIVILEGED TO BE GLOBAL

Q3 of FY19 Investor Update Presentation

WORLD STEEL SCENARIO (JAN-DEC) 2018, MMT ~

"" Crude Steel Production '	2017""	"""". (Jan-Dec) 2018	Change"2018vs. 2017
World	1,730	1,809	,<{sol'" " • - "" ()j
China	871	928	-:£3.6o~Q)
World without China	859	881	( 2.50/9)

Growth.!Decline Areas	% 1-	% of world pdn
Asia	5.6	70%
Middle East	11.7	2%	India produced 106 mmt steel posting a growth of 5.0%I
Africa	7.2	1%
N. America	4.1	7%
S. America	1.3	2%
Europe	0	17%

• The estimates between 018 & 2022 are taken at growth rate of 2% per annum for rest of the world

• Additional EAF capacity of 110 mmt between 2016 and 2020, would mean an additional demand of appx 275,000 mt of GE in China. Which may further go upto 310,000 mt by 2022

Industry Outlook [rtE6]

• .:. Global crude steel production reached 1.81 billion tonnes for the year 2018, up by 4.6% compared to 2017
• .:. China has achieved its capacity elimination target by 2018. however output cuts for environmental reasons will be less stringent in 2019 .
• :. In CY18 China's finished steel exports decreased by 8.1 % on year to 69.336 MMT in 2018 due to strong domestic market driven by steel capacity elimination and output cuts for environmental reasons .
• :. China is pushing for more incentive policies to boost domestic demand in major steel consumption sectors li ke infrastructure, vehicles and white goods
• .:. India removed antidumping duties on graphite electrodes imported from China in September 2018 which has increased imports .
• :. Needle coke supply continues to be tight and ou r efforts are on to organize as much coke as possible
• .:. All needle coke suppliers are now offering prices on half yearly basis which is a departure from past practice where they used to give prices valid for one year
• .:. Demand for UHP Graphite electrodes continues to remain strong and prices are expected to remain stable at an elevated level.

Financial Snapshot

in Rs. Crare (except EPS)

REVENUE FROM OPERATION	1865I	1794	1587	843	2758
EBITDA*	1351	1389	1197	563	1734
EBITDA Margin	72%	77%	75%	67%I	63%I
EBIT	I1332	1371	1180	I544I	I1661
EBIT Margin	71%	76%	74%	65I	,60%
PAT	867	889	770	i342	I1081
PAT Margin	46%	50%	490/0	41%	39%
EPS	216.93	222.45	192.77	85.62	.270.61

* EBITDA includes Other Income

~Ee) Segmental Performance - Graphite Electrodes

in Rs. Crore

Net Sales	1858	1793	1587	831	2739
Export (%of sales)	80%	72%	69%	65%	71%
EBITDA Margin	70.7%	77.2%	75.3%	64.4%	61%
EBIT Margin	70%	76.37%	74.40%	63%	59%

.:. Capacity utilisation at around 820/0 during the Quarter.

.:. USO/INR favorable, as graphite electrode business is net exporting segment.

Segmental Performance - Power

in Rs. Crore

	Q3 FY19	Q2 FY19	Q1 FY19	Q3 FY18	FY18
Net Sales	35.37	28.85	27.88	69.32	213.80
EBITDA Margin	$\overline{\phantom{a}}$	$(16)%$	$(6)%$	35%	28%
EBIT Margin	$(8)%$	$(26)%$	(18)%	30%	23%

• Coal availability under FSA with Coal India acutely short. Sourcing of coal from open market $\sigma_{\rm eff}^{\rm th}$ affecting bottom line.
• Net sales reduced in Q3 of FY19 vs. Q3 of FY18, as company has been able to negotiate a win $\sigma_{\rm eff}^{\rm th}$ win deal with state electricity board since Feb 2018. Hence, own generation reduced due to commercial reasons.

Thank You

Ms Dimple Momaya heg @adfactorspr.com +91 98207 62036 Mr.Manish Gulati, COO &CMO Mr. Gulshan Sakhuja, CFO HEG Limited Ph: +91 9910103865 Fax: +91 120254 1575 Email: manish.gulati@lnjbhilwara.com gulshan.sakhuja@ lnjbhilwara.