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Informist, Friday, Apr. 25, 2025

By Ashutosh Pati and Narayana Krishna

MUMBAI – Despite the recent volatility in zinc prices due to the trade war between the US and China, Hindustan Zinc Ltd. is bullish about demand for zinc in India. The government's focus on infrastructure development is driving demand for steel, which in turn will lead to increased zinc consumption for corrosion protection, the company's management told analysts in a post-earnings conference call Friday. Zinc is used in galvanisation of steel.

The Vedanta group company expects production of its saleable silver to rise to 1,200-1,300 tonnes, with planned expansions at the Agucha, Zawar, and Sindesar Khurd mines. It has set a target of 700-710 tonnes of saleable silver production in the financial year 2025-26 (Apr-Mar). The company is also planning to hire advisors to explore mines globally and double its resource base.

In FY26, it expects mined metal production of around 1.13 million tonnes and refined metal production of around 1.10 million tonnes. The quarter ended March was the best one in recent years for the company in terms of metal production. Hindustan Zinc reported a 4% on-year and 17% on-quarter growth in mined metal production in the March quarter at 310,000 tonnes -- the highest-ever quarterly mined metal production since the company transitioned into underground mining.

The transition to underground mining from open pit is usually done when resources at the surface have depleted or when underground resources are accessed. The rise in output was driven by higher mined metal grades, mills recovery, and an increase in production at the Agucha and Zawar mines.

The company's fertiliser plant at Chanderiya is set to be commissioned by the fourth quarter of FY26. The plant aims to support farmers' needs through production and sale of diammonium phosphate fertilisers. The company's 160,000-tonne per annum roaster at Debari is expected to be commissioned in Apr-Jun.

Hindustan Zinc is also implementing technology to recover lead and silver from the smelter waste as an alternative to fuming technology. This technology will help recover additional 27 tonnes per annum of silver and 6,000 tonnes per annum of lead and is scheduled to be commissioned in quarter four of FY27. Meanwhile, the company said that if coal prices remain low, it could save $25-$30 per tonne in production cost.

When asked if prices of silver could mirror the trend in gold, the company said that silver's industrial demand remains firm and prices of the metal are expected to rally similar to gold prices. Shares of Hindustan Zinc Friday ended 3.1% lower at INR 445 on the National Stock Exchange.  End

Edited by Ashish Shirke

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