The board of HEG Limited, a graphite electrode manufacturer, announced its fourth quarterly results for the financial year that ended on March 31, 2024, on Wednesday, May 22.

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Alongwith quarterly results, HEG also declared a dividend of Rs 22.50 per equity share of the face value of Rs 10 each. This is subject to the approval of company's shareholders.

"The board of directors has recommended a final dividend on Equity Shares at the rate of Rs. 22.50 per Equity Share of the face value of Rs. 10/- each, for the financial year 2023-24 subject to the approval of the Shareholders at the ensuing Annual General Meeting (AGM) of the Company. The dividend will be paid/ dispatched within 30 days from the date of the Annual General Meeting," the company said in a BSE filing.

Demerger and merger of businesses

In a separate BSE release, the company has also informed that it has decided to demerge its graphite business and merge Bhilwara Energy into HEG Limited.

The demerger will result in a share swap ratio of 1:1, while for the merger, the company said, "8 (Eight) fully paid-up equity shares of Rs 10 each of the transferee company, for every 35 (Thirty Five) equity share of Rs 10 each of the transfer or company."

HEG said the segregation of businesses with varying risk profiles offers shareholders greater flexibility to align risk preferences and de-risk the graphite business.

"The existing company and the new company will script new paths as two independent, publicly listed companies. The underlying growth drivers, risk profile, and capital allocation requirements are fundamentally different in the Graphite business compared to the green energy business," said Ravi Jhunjhunwala, chairman, managing director and CEO of HEG.

The existing company will be turned into a platform for green energy businesses, hydro and wind energy, advanced carbon business, and other opportunities in the new age businesses.

"This step will create a more agile and competitive entity that can tap opportunities in the clean energy space. Shareholders will have shares of 2 publicly listed companies, each with a sharper strategic focus and enhanced investment profile," said Riju Jhunjhunwala, vice-chairman, HEG.

HEG Q4FY24 earnings

HEG reported a consolidated revenue of Rs 547 crore, down 11 per cent from Rs 617 crore in the same quarter of financial year 2023. The company's net profit also declined by 67 per cent to Rs 33 crore. It was Rs 100 crore in Q4FY2023.

HEG 's EBITDA was 65 per cent down to Rs 43 crore.

Shares of HEG were trading at Rs 2,429.95 each, down 9.43 per cent or Rs 253.1 each on BSE today, May 23 at 12.27 PM IST.