After rising over 3,800 percent between November 2008 and November 2018, shares of this carbon and graphite product manufacturing company, tumbled 77 percent in the next 1 year.

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The stock price of HEG rose from Rs 113.8 in November 2008 to its record high of Rs 4,480 in November 2018, surging 3,836 percent in ten years. However, post its stunning rise, the stock shed as much as 77.2 percent from its all-time high to Rs 1,021 currently.

The fall came on back of concerns of margin pressure due to the rising raw material cost.

The stock also hit its 52-week low of Rs 833.75 on October 15, 2019, shedding 81.3 percent from its all-time high of Rs 4,480 hit on November 20, 2018.

The company manufactures graphite electrodes, mainly producing two grades of graphite electrodes, High Power and Ultra High Power. In late 2018, the price of non-UHP (ultra-high power) was hit after India ended anti-dumping duties on graphite electrodes imported from China. UHP prices were also impacted by weakness in steel prices around that time.

Moreover, it also stopped exporting to Iran in the December quarter while awaiting clarification on the exemption from US sanctions putting further pressure on the company.

The continuous fall in realisations and increasing input costs have also impacted the weakening of the company. The cost of the raw material has increased and has also impacted the margins of the companies.

In Q1, the company reported a 69 percent decline in its consolidated net profit at Rs 243 crore due to lower realisation. It had posted a profit of Rs 776 crore in the year-ago quarter.

Operational revenue during the quarter dipped 48 percent to Rs 816 crore from Rs 1,587 crore reported in Q1FY19, while EBITDA margin contracted to 42.6 percent from 74.8 percent, due to increase in average needle coke cost.

“China could play the proverbial spoilsport. They have installed and commissioned new needle coke and graphite electrode capacity. If they do not shore up their Arc Furnace steel capacity to absorb these additional volumes, the resultant excess could dampen the prospects of the graphite electrode market,” HEG said in 2019 annual report.

The company is yet to declare its Q2 numbers.