H.E.G. Ltd.

“HEG is a single-product cyclical commodity manufacturer with no pricing power, zero structural growth, and sub-cost-of-capital mid-cycle returns, trading at 36-43x normalised earnings — a premium reserved for high-quality compounders it is not. The fortress balance sheet prevents catastrophe but cannot create value in a business structurally unable to compound. With intrinsic value estimated at INR 155-240 versus a market price of INR 559, the stock offers deeply unfavourable risk/reward for long-term investors. Capital should be deployed elsewhere.”