Buy Heg, target price Rs 2320: IIFL Securities

IIFL Securities has recommended a 'buy' call on Heg, citing attractive valuations and strong fundamentals. At the current market price of Rs 2246.55, the brokerage firm has set a target price of Rs 2320, indicating a potential upside of over 3%. Heg is a leading manufacturer of graphite electrodes, which are used in electric arc furnaces. The company has been benefiting from strong demand for its products, driven by the growth in the steel industry. The brokerage firm believes Heg's strong financial performance and growth prospects make it an attractive investment opportunity.

About Heg:

HEG Limited (formerly known as Hyderabad Engineering and Guest House Private Limited) is an India-based company engaged in the manufacture of graphite electrodes. The company is involved in the production and supply of graphite electrodes to the steel industry. It has a manufacturing facility located in Mandideep, Madhya Pradesh, India. The company's product portfolio includes graphite electrodes, carbon blocks, carbon paste, and other carbon products. HEG Limited exports its products to various countries across the globe, including the United States, Europe, and Asia.

52 Week Price Trend:

HEG's current market price (CMP) of Rs 2246.55 falls within a wide range defined by its 52-week high of Rs 2011 and 52-week low of Rs 918. This indicates significant volatility in the stock's price movement over the past year. The CMP suggests that the stock has rebounded from its low but remains below its recent peak. Investors considering HEG should carefully evaluate the company's fundamentals, market conditions, and potential risks before making a decision.

Stratzy's MOST Analysis:

HEG's BB- rating from Stratzy's MOST framework indicates medium fundamental risks. The rating is based on an assessment of HEG's management, outlook, safety, and trend. The rating suggests that HEG has some weaknesses in these areas, but overall, its fundamentals are considered sound. Investors should be aware of the potential risks associated with investing in HEG, but they should also consider the company's strengths before making a decision.

Company's Fundamentals:

HEG, listed on the National Stock Exchange (NSE), has a current stock PE ratio of 17.17, indicating that its share price is 17.17 times its earnings per share. This suggests that investors are willing to pay 17.17 times the company's annual earnings for each share they own. The PB ratio of 1.49 implies that the market value of the company's shares is 1.49 times its book value, indicating that investors value the company slightly above its net asset worth. Additionally, HEG pays a dividend yield of 2.52%, offering investors a return on their investment in the form of regular dividend payments.

Fundamental and Technical information provided in this blog were last updated on 30 Jul, 2024

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