Target: ₹551
CMP: ₹445.45
We recently attended a field visit to Hindustan Zinc’s (HZL) Chanderiya smelting complex and the underground mining operations at Rampura Agucha in Rajasthan – two of the company’s flagship assets. The visit concluded with an engaging interaction with the CFO, Sandeep Modi, offering valuable insights into the company’s strategy and outlook.
Refined metal production is expected to reach 1,180kt by FY27E, supported by ongoing debottlenecking initiatives aimed at achieving full utilization across HZL’s smelting complexes. HZL’s silver segment has emerged as a key earnings pillar and is expected to play an increasingly important role in driving profitability.
We maintain our positive stance on HZL, primarily driven by the strong earnings outlook from its high-margin silver segment. While silver volumes declined in FY25, we expect a rebound as the fumer plant ramps up, with production projected to reach about 750 tonnes by FY27E.
For FY26E, management has guided for 700–710 tonnes of silver output. In FY27E, we expect incremental gains of ~30tonnes as the fumer operates at optimal levels. This ramp up should significantly boost both topline and profitability, reinforcing silver’s role as a core growth engine.
We continue to value HZL at 11x FY27E EV/EBITDA multiple to arrive at our revised target price of ₹551/share
Published on July 3, 2025