Hindustan Zinc Share Price

Hindustan Zinc Limited

Hindustan Zinc Limited (HZL) is one of India’s leading mining companies with a dominant position in zinc, lead and silver production. Part of the diversified Vedanta Group, HZL operates multiple mines and smelting facilities mainly across Rajasthan. With its extensive reserves, integrated operations and strategic growth initiatives, the company has strengthened its stature as a global industry leader.

Company Overview

Incorporated: 1966 as a Public Sector Undertaking, privatized in 2002

Headquarters: Udaipur, Rajasthan

CEO: Arun Misra

Businesses: Zinc, lead, silver, cadmium, wind energy

Stock Exchange Listings: BSE, NSE

Major Facilities: Rampura Agucha, Sindesar Khurd, Zawar, Rajpura Dariba, Kayad, Chanderiya

Mining Assets

HZL’s mining assets in Rajasthan represent the core of its business.

• Rampura Agucha: World’s largest zinc mine with annual ore production capacity of 6.15 million MT
  
• Sindesar Khurd: Among Asia’s largest underground zinc-lead mines with capacity of 5 million MT
  
• Rajpura Dariba: One of world’s deepest underground zinc-lead mines, over 1,500 meters deep
  
• Zawar Mines: One of India’s oldest mines, rich in zinc, lead, silver deposits
  
• Kayad Mine: Open-cast zinc mine, produces 1 million MT per year
  

Smelting Facilities

To process mined ore, HZL operates smelters located close to mines.

• Chanderiya lead-zinc smelter: World’s largest zinc smelter with capacity 1.08 million MT
  
• Dariba zinc smelter: Capacity 215,000 MT per year
  
• Debari zinc smelter: Capacity 80,000 MT per year
  
• Visakhapatnam zinc smelter: Capacity 219,000 MT per year
  

Other Infrastructure

• 8 Sulphuric acid plants of 2 million MT total capacity
  
• Silver refinery: 120 MT annual capacity
  
• Captive power plants: 1,425 MW coal-based, 354 MW renewable energy
  

Production Figures

Hindustan Zinc Limited (HZL) has achieved record production figures in recent years, reflecting its strong operational performance. Below are the most recent production statistics for FY24:

Production Figures for FY24

1. Mined Metal Production:
Achieved a record 1,079 kilotonnes (kt), representing a 2% year-over-year (YoY) increase due to improved mined metal grades and higher ore production across mines.

2. Refined Metal Production:
Total refined metal production reached 1,033 kt, marginally higher than the previous year, driven by better plant availability and operational parameters.

3. Saleable Silver Production:
   Recorded its highest-ever silver production at 746 metric tonnes (MT), a 5% YoY increase, supported by higher work-in-progress (WIP) depletion and lead metal production.
   

Q4 FY24 Highlights

• Mined Metal: Produced 299 kt, up 11% quarter-on-quarter (QoQ) but marginally down 1% YoY.
• Refined Metal: Achieved 273 kt, marking a 6% QoQ increase and 1% YoY growth.
• Silver Production: Produced 189 MT, up 4% YoY but down 4% QoQ due to lower lead metal production.

These figures underscore Hindustan Zinc's robust operational capabilities and its ability to achieve record-breaking production levels across its core products.

Financial Performance

Hindustan Zinc Limited (HZL) has delivered a mixed financial performance in recent quarters, reflecting operational efficiencies, market dynamics, and cost management. Below is a summary of its recent financial performance:

Q3 FY25 Financial Highlights (October–December 2024)

1. Revenue from Operations: ₹8,832 crore, up 16.12% year-over-year (YoY) from ₹7,606 crore in Q3 FY24.
   

2. EBITDA: ₹4,539 crore, a 28% YoY increase, driven by higher zinc and silver prices and cost optimization.
   

3. Net Profit (PAT): ₹2,678 crore, a 32% YoY rise from ₹2,028 crore in Q3 FY24, supported by higher income and lower costs.
   

4. EBITDA Margin: Approximately 53%, up by 400 basis points YoY.
   

Operational Metrics

• Mined Metal Production: 265 kilotonnes (kt), down 2% YoY due to planned maintenance but up 3% quarter-on-quarter (QoQ).
• Refined Metal Production: Flat at 259 kt YoY.
• Saleable Silver Production: 160 metric tonnes (MT), down 18% QoQ.

Nine-Month Cumulative Performance (April–December 2024)

1. Revenue from Operations: ₹24,996 crore, a 17% YoY increase.
2. EBITDA: ₹12,649 crore, up 26% YoY.
3. Net Profit: ₹7,350 crore, a 28% YoY rise.

FY24 Annual Performance

• Revenue from Operations: ₹28,932 crore, down 15% from FY23 due to lower zinc prices and volumes.
  
• Net Profit: ₹7,787 crore for FY24, a decline of approximately 26% compared to ₹10,511 crore in FY23.
  

Key Drivers and Challenges

• The rise in Q3 FY25 profitability was attributed to higher London Metal Exchange (LME) prices for zinc and silver and cost reductions.

• Challenges included lower lead production volumes and ongoing operational disruptions due to external factors like partner availability.

HZL continues to maintain strong fundamentals with a focus on operational efficiency and sustainability. The company remains optimistic about achieving growth in the coming quarters with strategic investments and production enhancements.

Market Position

HZL enjoys a dominant position in its key products.

• 2nd largest zinc miner globally
• 3rd largest silver producer globally
• Industry leader in India for zinc, lead

Growth Drivers

• Multiple factors contribute to HZL's growth.

Increasing Metal Demand

• Expanding applications of zinc, lead in batteries, alloys, chemicals
• Infrastructure growth driving demand

Higher Realizations

• Zinc, lead, silver prices showing upward momentum
• Supporting profitability and investment capability

Integrated Operations

• From mines to smelters, power plants, everything in-house
• Results in cost optimization, efficiency

Strong Balance Sheet

• Low debt, ample cash flows to fund expansions
• Strengthened further through dividend payouts from parent Vedanta

Expansion Plans

• To capitalize on favorable demand dynamics, HZL plans to grow capacities across mines and smelters.

Zinc Mines

• Rampura Agucha: Expand to 10.2 million MT per year
• Sindesar Khurd: Augment to 7.2 million MT per year
• Develop Kayar zinc mine: 1 million MT per year capacity

Zinc Smelters

• Raise Chanderiya capacity by 0.5 million MT
• Install new smelter of 0.5 million MT capacity

Lead Smelter

• Expand Dariba lead smelter from 0.18 to 0.25 million MT

Exploration Activities

• Active exploration near existing mines and new locations
• Discovered rich deposits in Rajasthan, Madhya Pradesh, Uttar Pradesh
• Aims to substantially augment reserve base

Renewable Energy Investments

HZL plans major investments in solar and wind energy:

• Setup 1,000 MW renewable energy capacity by 2030
• Includes new solar parks, wind farms across multiple states
• To supply green power for mining operations

Sustainability Initiatives

• HZL aims to achieve sustainable growth through various interventions:

Water Conservation

• Adopted dry tailing to reduce fresh water usage
• Multiple rainwater harvesting structures
• Sewage treatment and reuse

Carbon Reduction

• Expanding renewable energy capacities
• Focus on clean technologies, monitoring
• Compensatory afforestation programs

Biodiversity

• Miyawaki plantation to enhance greenery
• Supporting conservation in wildlife reserves
• R&D for site reclamation

Community Development

• Livelihood, health, education initiatives for communities
• Partnerships with NGOs for women empowerment
• Infrastructure development in villages

Brief Overview

With its fully integrated operations from mining to smelting, strong market position and planned expansions, Hindustan Zinc is poised for robust long-term growth. Its high-quality assets, industry leadership, financial discipline and sustainability focus make it a promising investment opportunity, thus positively impacting the Hindustan Zinc share price. Backed by parent Vedanta’s strengths and metal market growth drivers, HZL is set to continue creating value for shareholders.