Why are HEG, Graphite India shares skyrocketing? EXPLAINED

Stocks in focus: Shares of HEG and Graphite India have garnered significant attention in Wednesday's trading session, following a notice from China's Ministry of Commerce. The notice announced an outright ban on several materials critical to chip-making destined for export to the United States (US), citing concerns regarding potential military applications.

HEG share price rose more than 14% today, touching a 52-week high, while the Graphite India share price increased by 7.5%. Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One highlighted that both the stocks have seen spectacular move in the last couple of sessions while HEG share price is up more than 25% , Graphite India share price is up more than 15%, we are seeing a bullish range breakout on the weekly chart for both the stock and is expected to continue upmove in the near term .

“Traders with existing positions should hold on whereas any dip could be treated as buying opportunity. Support for Graphite India is at ₹590 whereas ₹640 - 660 is resistance, HEG support is at ₹540 and resistance at ₹600,” added Bhosale.

Market experts believe that the Chinese government's decision will benefit Indian companies. As China is the world's largest exporter of graphite, the market anticipates a significant boost in business for these two Indian companies as a result of this decision.

“Shares of HEG and Graphite India are rising as China's Ministry of Commerce has issued a notice to strictly review shipments (containing dual-use graphite materials) heading for the US. The Chinese government's decision is expected to benefit these Indian companies. As China is the world's largest graphite exporter, the market expects that these two Indian companies' businesses will surge in the wake of this decision,” Mahesh M Ojha, AVP — Research at Hensex Securities.

A note on the Center for Security and Emerging Technologies website highlighted that a notice from China’s Ministry of Commerce, issued on December 3, 2024, bans the export of gallium, germanium, antimony, and superhard materials to the US. Additionally, it implements stricter export control checks on dual-use graphite materials. This action comes immediately after the US. announced new export controls and sanctions on December 2, aimed at preventing the sale of advanced US microchips and semiconductor manufacturing equipment to China.

Advantage for Vedanta, Tata Technologies

On the other hand, Anshul Jain, Head of Research at Lakshmishree Investment and Securities, emphasized how the Sino-US trade war is expected to impact the Indian stock market and highlighted Vedanta, Tata Technologies to also benefit apart from other two companies.

"The Chinese government has vowed to stop the export of three metals: gallium, germanium, and antimony. These two metals are used in semiconductors. So, the benefits of this China-US trade war are expected to trickle down on two other Indian companies: Vedanta and Tata Technologies," added Jain.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.