Shares of Rhi Magnesita India Ltd experienced a significant surge of over 14% in Thursday's trading session, reaching an intraday high of Rs 443.55. The rally followed key announcements regarding a leadership reshuffle and a strategic joint venture aimed at bolstering sustainable refractory solutions.
The company confirmed the appointment of Pankaj Malhan as the new Managing Director and Chief Executive Officer, effective July 1, 2026. Parmod Sagar, who previously held the Chairman, MD, and CEO roles, will continue to serve as the Chairman. This leadership transition aims to steer Rhi Magnesita India into its next phase of growth.
Strategic Expansion and Sustainability Focus
Adding to the positive market sentiment, Rhi Magnesita India announced a strategic joint venture with Khemka Refractories Pvt Ltd, a prominent manufacturer of refractory raw materials. This partnership is set to establish a greenfield refractory recycling facility in Odisha, India.
The new facility is strategically located to cater to India's burgeoning steel production sector and major industrial manufacturers. Its primary goal is to accelerate circular business models and meet the rapidly growing demand for closed-loop sustainable solutions within the Indian refractory market by creating an integrated recycling supply chain.
In a separate corporate development, the company also completed the merger of its wholly-owned subsidiary, Intermetal Engineers (India) Pvt Ltd, with another subsidiary, Ashwath Technologies Pvt Ltd.
Analyst Outlook and Financials
Despite the recent stock performance, Nuvama Institutional Equities noted that Rhi Magnesita's adjusted EBITDA for Q4 FY26 stood at Rs 113 crore, falling short of their Rs 145 crore estimate. This figure represented a 6% year-on-year and 39% quarter-on-quarter decline, primarily attributed to lower volumes and increased operational expenses. Volumes reportedly decreased by 14% sequentially during the quarter, with the adjusted EBITDA margin contracting by 160 basis points to 12.1%.
Looking ahead, Nuvama anticipates an improvement in EBITDA margins in Q1 FY27, largely supported by recently agreed price hikes with customers. The brokerage also highlighted a strong 18-month order book, which is expected to offset pressure on commoditized products and contribute to projected margins of 13% for FY27E and 13.5% for FY28E. Nuvama has reiterated its 'BUY' rating on Rhi Magnesita India, albeit with a revised target price of Rs 557, down from Rs 600 previously, valuing the stock at 32x FY28E EPS.