Analyst Concall
Hind Zinc confident of meeting FY26 silver production target
This story was originally published at 19:54 IST on 18 July 2025
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By Shakshi Jain and Sunil Raghu
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--Hind Zinc: Renewable energy had 19% share in power consumption mix Q1
--CONTEXT: Comments by Hind Zinc's mgmt at post-earnings analyst concall
--Hind Zinc: To commission Debari project in Sept quarter, have begun trials
--Hind Zinc: To spend INR 18 bln on upcoming 0.5 mln tn/yr fertiliser plant
--Hind Zinc: Spent INR 10 bln on fertiliser unit, to spend rest in 9 months
--Hind Zinc: More green energy, domestic coal lowered power costs Q1
NEW DELHI/AHMEDABAD – Despite lower silver production volume in the June quarter, Hindustan Zinc Ltd. is confident of achieving its target of 700-710 tonnes set for 2025-26 (Apr-Mar). "In Q3 (Oct-Dec), Q4 (Jan-Mar) will see much better numbers of silver... which will compensate for the loss and help us to reach the guidance number," company management said in a post-earnings analyst conference call.
The company's production of saleable silver fell 11% on year and by 16% sequentially to 149 tonnes in the June quarter. This fall was attributed mainly to lower silver input from SK mine and higher work in progress liquidation in the March quarter.
"So, if you look at the silver volume, partly a part of it can be attributed to lower metal production by itself. Since you produce lower metals, the associated silver is also lower. Other part is also in the beginning of the year, the current location in SK mine, where we are encountering lower grade of silver in the overall grade," the company management explained. With the conclusion of the company's debottlenecking project and commissioning of a new roaster in the September quarter, Hindustan Zinc is hopeful of higher silver production in the second half of the ongoing fiscal.
The company is setting up a 160,000 tonnes-per-annum roaster at Debari in Rajasthan that it hopes to commission in the current quarter. The company management said it had already begun trials at the facility. It is also undertaking a 21,000 tonne-per-annum cellhouse debottlenecking project at its Dariba Smelting Complex and Chanderiya Lead Zinc Smelter in Rajasthan to increase production capacity. It is expected to be completed in the ongoing quarter too.
Among other upcoming developments, Hindustan Zinc's 510,000 tonne-per-annum fertiliser plant at Chanderiya is set to be commissioned in the first quarter of FY27, as per the company's investor presentation. "So, fertilizer, total cash cost is around 1,800 crores (INR 18 billion) and around 1,000 crores (INR 10 billion) already been spent and remaining will be spent by nine months," company management said.
The Vedanta group company's total refined metal production was down over 7% on year and more than 4% sequentially at 250,000 tonnes in the June quarter. Meanwhile, its overall mined metal production rose 1% on year to a record 265,000 tonnes during the quarter.
Hindustan Zinc's net profit for the June quarter fell 6.5% on year to INR 22.04 billion and its total revenue from operations was down 5% on year at INR 77.23 billion. The company's bottom line fell faster than its revenue as total expenses of the company fell only by 4% on year. A less than 5% on-year decline in power and fuel costs of the company kept it from achieving a higher bottom line as expenses related to mining royalty fell 5.5% on year and depreciation and amortisation costs fell 8% on year for the quarter. Power and fuel costs accounted for 12% of the company's overall expenses for the quaretr.
On the company's power consumption mix in the June quarter, company management said 19% of the supply came from renewable sources while around 80% came from coal. Within this, 55% of it was domestic coal while 45% was imported. According to the company, a higher share of renewable energy and better quality of domestic coal helped the company bring down power consumption costs during the quarter.
Friday, shares of Hindustan Zinc closed 0.4% lower at INR 435.50 on the National Stock Exchange. End
Edited by Deepshikha Bhardwaj
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