Graphite India shares marginally drop after rallying for three straight days, gain 15% in a week

Graphite India, a prominent producer of graphite electrodes, witnessed a remarkable surge in its stock price, climbing by an impressive 12 per cent on Monday. This unexpected rally comes in the wake of a somewhat underwhelming performance during the March quarter. While trading volumes have also experienced a substantial increase in recent weeks, the company's financials may not fully account for the renewed market interest.

The company’s shares were trading almost flat at Rs 376.4 apiece, down 0.08 percent, on BSE at 12:35 PM on Monday after rallying for three straight days. The stock was trading above its 10-day, 50-day, 100-day, and 200-day period moving averages. Over the past week, shares have climbed by more than 15 per cent and by nearly 16 per cent over the past month-long period.

Over the last one-year the company’s shares have fallen more than 17 per cent and since the start of 2023 shares have gone down by 3.08 per cent.

The company’s financial results for the March 2023 quarter showed a decline in revenue, operating profit, margin, and net profit compared to both the previous quarter and the corresponding period last year.

Despite the lackluster Q4 performance, Graphite India's stock has managed to rebound remarkably, reaching an impressive 43 per cent increase from its March lows. This significant recovery suggests that market participants are taking a more long-term perspective, focusing on the potential growth prospects of the graphite electrode industry.

In the March quarter, the company reported a significant decline in consolidated profit, reaching Rs 29 crore compared to Rs 95 crore in the same quarter of the previous fiscal year. The company also reported a decrease in revenue, amounting to Rs 815 crore for the quarter. EBITDA fell by 29.55 per cent to Rs 62 crore in Q4. On a year-on-year basis, the company reported similar results with revenue being the exception, as it witnessed an increase of 5.12 per cent.