Weak demand and heightened inventory led to Graphite India Ltd.’s subdued realisations and lower sales volumes (last six quarters).

We expect it to benefit, however, from coming tailwinds.

  1. A pick-up in steel production globally (up 2.3% YoY in Q2 FY21)
  2. The recent rebound in graphite-electrode prices in China
  3. Expectations of complete destocking of electrode stocks in the next two quarters
  4. Benign raw material prices

Q2 FY21 capacity utilisation improved sequentially from 42% to 72%, which, we believe would continue.

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