RHI Magnesita shares rise 13% on highest-ever EBITDA margin

RHI Magnesita's revenue dropped 7 percent on quarter to Rs 878.76 crore, driven by an 8 percent decline in volume to 113,916 tonnes.

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Shares of RHI Magnesita - makers of special refractory products - rose 13 percent on August 16 after Q1FY25 results showed record EBITDA margin, which expanded to 17.5 percent, helped by recent acquisitions.

"We are pleased to report that we have delivered the highest margins since the completion of acquisitions over a year ago," said Parmod Sagar, MD & CEO of RHI Magnesita, adding that while end-user industries faced challenges from cheaper imports and rising costs, RHI Magnesita sustained strong margins.

RHI Magnesita, formerly known as Orient Refractories, had acquired Hitech Chemicals in October 2022 and Dalmia Bharat Refractories in January 2023.

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At 11.30am, RHI Magnesita's shares traded 11.7 percent higher at Rs 661.20. The stock has risen 3 percent in the past six months, underperforming the Nifty 5o which rose over 10 percent during the period.

RHI Magnesita's Q1FY25 revenue fell 7 percent on quarter to Rs 878.76 crore, driven by an 8 percent decline in volume. This drop in volume was due to subdued customer activity, weighed down by an intense heatwave, elections, increased steel imports, and lower exports.

Also Read | RHI Magnesita Standalone June 2024 Net Sales at Rs 701.15 crore, up 3.54% Y-o-Y

The company's net profit for the June quarter came in at Rs 72.88 crore in the quarter ended June 2024 as against a loss of Rs 257.89 crore during the previous quarter.

A stronger product mix and a one-time high-margin order boosted gross margins to 45 percent, up from 43 percent in Q4 FY24. EBITDA for the June quarter rose 4 percent sequentially to Rs 154 crore.

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