Graphite India shares fell over 5% in early trade on November 4 despite strong September quarter earnings. The stock hit Rs 708.35 on the BSE. Chairman K K Bangur said the performance was "driven by higher volumes and realizations." Higher input costs weighed on margins, limiting overall profit growth.
Graphite India shares declined over 5% in early trade on November 4, even after the company reported strong September quarter earnings. The stock plunged as much as 5.54% to Rs 708.35 apiece on the BSE.
The company's net profit in the second quarter of FY27 rose to Rs 96 crore from Rs 77 crore in the corresponding period last year. Revenue from operations increased 13.3% to Rs 826 crore from Rs 729 crore a year ago. The company also reported a one-time loss of Rs 22 crore during the quarter.
Operating performance in Q2FY27 improved at a faster pace, with EBITDA climbing 93% to Rs 83 crore from Rs 43 crore a year ago. EBITDA margin also expanded to 10% from 5.9% in the year-ago quarter.
Graphite India reported a sequential improvement in graphite profitability, with segment EBIT rising 46% quarter-on-quarter to Rs 820 million. Segment margins expanded by 345 basis points, partly offsetting the impact of lower steel realisations. Healthy capacity utilisation of 96% and improved graphite electrode (GE) realisations supported overall EBITDA of Rs 830 million.
The company attributed the revenue growth to higher sales volumes and realisations. Chairman of Graphite India, K K Bangur, said the quarter's performance was "driven by higher volumes and realizations."
The company also highlighted an improvement in graphite electrode prices during the quarter, supported by a recovery in demand. However, higher input costs continued to weigh on margin improvement. The chairman stated that "higher input costs have limited the extent of margin expansion."
He also commented on the medium-term outlook of the company, saying that the company "remains optimistic about the medium-term outlook for graphite electrodes."
Emkay Global Financial Services believes a graphite electrode price hike is imminent as the industry's supply-demand balance tightens, strengthening the pricing power of incumbent players. While higher needle coke costs could weigh on margins in the near term, the brokerage expects companies to pass on the increased costs to customers as GE prices improve.
Emkay has maintained its ‘Buy' rating on Graphite India shares with a target price of Rs 1,050.
Graphite India Stock Price Performance
The shares of electrode manufacturer has been under pressure over the past month, with the stock declining around 8%; however, it remained up around 12% during 2026 so far. Graphite India shares have rallied 18% in one year and have jumped 59% over the past three years.
At 11:05 AM, Graphite India share price was trading 3.11% lower at Rs 726.55 apiece on the BSE.