Hindustan Zinc quarterly profit jumps on higher metal prices, stronger output

Traders Union
All News
Business & Wealth
Companies
Hindustan Zinc profit surges

Highlights

Hindustan Zinc reported consolidated net profit of 64.12 billion rupees ($675.5 million) for Q2, up from 26.49 billion rupees a year earlier, with a net profit margin rising to 42%.
Total revenue from operations increased 76.5% to 150.93 billion rupees as mined metal output rose 5% and silver production jumped 20% year on year, doubling revenue from silver sales.
Zinc production costs excluding royalty fell 29% to $703 per ton, while higher global zinc and silver prices, plus supply disruptions, provided tailwinds to profitability and outlook.

Quarterly earnings driven by prices and production

As reported by Reuters, Hindustan Zinc posted consolidated net profit of 64.12 billion rupees, or $675.5 million, for the quarter ended Sept. 30, up from 26.49 billion rupees a year earlier. Its net profit margin climbed to 42% from 31% a year earlier, while total revenue from operations rose 76.5% to 150.93 billion rupees.

Total expenses increased 31.5% to 68.95 billion rupees. The Vedanta group company operates across mining, processing and refining of zinc, lead and silver, and also has wind power generation assets.

Hindustan Zinc's mined metal production rose 5% year on year to 271 kilotons in the quarter, while refined metal production increased 7% to 264 kilotons. Silver production rose 20% to 173 tons, and revenue from silver sales more than doubled.

Zinc production costs, excluding royalty, fell 29% to $703 per ton, helped by higher production, better ore grades and increased renewable power consumption, the company said.

Metal market tailwinds support outlook

Zinc prices have surged amid supply disruptions and expectations of a global market deficit, creating a favorable backdrop for producers. Firmer silver prices, supported by demand for precious metals, have also improved the company's profit outlook, according to Jefferies.

Hindustan Zinc commands roughly three-fourths of India's zinc market, giving it significant exposure to domestic industrial demand as well as international price movements. The latest quarter shows how stronger metals pricing and output gains are combining to lift profitability in the sector.

In our earlier report on India’s September merchandise trade deficit, we noted the gap widened to $30.21 billion as imports rose faster than exports, driven largely by a higher oil import bill with Brent crude holding above $100 a barrel. We also highlighted India’s push to diversify export markets via new and advancing trade agreements, as elevated commodity costs continue to influence the country’s external balance.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.