Rhi Magnesita India shares zoom over 14%; company undergoes leadership rejig

Shares of Rhi Magnesita India Ltd surged 14.29 per cent in Thursday's trade to hit a high of Rs 443.55. The stock later pared more than half of its gains and was last seen trading 6.27 per cent up at Rs 412.45. At this level, the counter has slipped 9.47 per cent over the last six months.

The company recently underwent a leadership rejig and appointed Pankaj Malhan as the Managing Director and Chief Executive Officer, effective July 1, 2026. Its Board also announced that Parmod Sagar, who has been serving as Chairman, MD and CEO, will continue as the Chairman.

Last month, the manufacturer and supplier of high-grade refractory solutions announced a strategic joint venture (JV) with Khemka Refractories Pvt Ltd, a refractory raw-materials manufacturer.

"Together, the companies will accelerate circular business models and establish a greenfield refractory recycling facility in the eastern state of Odisha, India. Strategically located in the heart of India's steel production and close to major Industrial manufacturers, the proposed facility will support the rapidly growing demand for closed-loop sustainable solutions in the Indian refractory market by creating an integrated recycling supply chain," it stated.

Prior to this, the company had approved the merger of its wholly owned subsidiary, Intermetal Engineers (India) Pvt Ltd, with another subsidiary, Ashwath Technologies Pvt Ltd.

On the earnings front, Nuvama Institutional Equities noted that Rhi Magnesita posted an adjusted EBITDA of Rs 113 crore in Q4 FY26, below its estimate of Rs 145 crore. The figure was down 6 per cent year-on-year (YoY) and 39 per cent quarter-on-quarter (QoQ), primarily due to lower volumes and higher other expenses.

According to Nuvama, volumes declined 14 per cent sequentially during the quarter. The brokerage also noted that the company's adjusted EBITDA margin contracted by 160 basis points (bps) to 12.1 per cent, while adjusted EBITDA per tonne stood at Rs 9,688, compared with its estimate of Rs 10,600 per tonne, reflecting a 12 per cent QoQ decline.

Looking ahead, Nuvama expects margins to improve in the first quarter of FY27.

"EBITDA margin shall improve in Q1 FY27, supported by price hikes agreed with customers. Furthermore, strong order book of 18 months to offset pressure on commoditised products, aiding margins of 13 per cent/13.5 per cent in FY27E/28E," the brokerage said.

"We cut FY27E/28E PAT by 12 per cent/7 per cent to factor in higher CoP (cost of production). Maintain 'BUY' with a revised TP of Rs 557 (earlier Rs 600), valuing it at 32x FY28E EPS. The stock trades at 23x FY28E PE," Nuvama further stated.