VibhutiSharma

HEG Long-Term

Long
NSE:HEG   HEG LTD
OVERVIEW . . .

HEG Ltd, a premier company of the LNJ Bhilwara group, is today India’s leading graphite electrode manufacturer. It has one of the largest integrated Graphite Electrode plants in the world, processing sophisticated UHP (Ultra High Power) Electrodes.
The company exports over 70% of its production to more than 30 countries of the world.
Expertise in: Graphite Electrodes, Power Division, Carbon Specialty.

Fundamentals
• Positive:

o Revenue up by 7% to 435.75 Cr . (Qtr. Ended 30-06-21)
o Net profit 56.77 Cr . from (16.08) *. (Qtr. Ended 30-06-21)
o Free cash Flow: 427.37 Cr . (YOY).
o FII Holding increased by 1.84% (Qtr. Ended 30-06-21)
o Zero promoter pledge.
o Debt free Co.
Negative:
o MFs Dec. stake in last quarter.
o High PE with 0ve ROE
o Declining Net cash flow (YOY)

CONCLUSION: Due to lockdown manufacturing had been stopped and results Dec. in growth (YOY). But in current qtr. Co. has been showed strength by making profits (Turnaround from Loss to PROFIT(QOQ)*. Also has potential to perform well in coming quarters.

TECHNICALS . . .
Prior Trend: With the break of support at 3568, it appeared that a downtrend had begun. Even though the decline was not that sharp , the new reaction low represented a 52-week low. HEG was clearly not in an uptrend.

Decline: The stock declined from 4562 to a low of 519 and a pair of hammers formed in (23 Mar - 30 Mar) to mark the end of the decline.

Low: Prior to the hammers, the stock traded around (range: 1216 - 451) for the previous 8 months. When the gap up with high volume followed the hammers, it appeared that a low had been formed. After a short rally, there was another test of the low and a higher low formed at 725 on 1st june'2020.

Advance: From the third low on 2nd Nov.'2020 at 658, the advance began in earnest and volume started to increase. And, finally HEG makes Higher Lows with HUGE VOLUMNE SPIKES.

Now, currently , consolidating b/w the Range (2408 - 2000).

Comments

Good analysis
Reply
good
Reply
Good volume contraction seen at resistance level.

Bullish hammer is good indication for break out.

Still last 4 month it trade in limited terretory. breakout with higher volume confirm the BO.
Reply