Hind Zinc at new high, again!

Hindustan Zinc, a part of the Vedanta group has been hitting new 52-week highs consistently for the past 5 sessions, including today. Figuring among the top five gainers on the BSE, the stock today rose 9% to hit a new high at Rs.807, which is not too far from its 10% UC of the day at Rs.816.25.

The stock has hitting new highs on the back of metal prices surging to new highs. While copper prices have been leading the pack, prices of zinc and silver, lead and aluminium too have been scaling high. Hind Zinc’s products include zinc ore, lead zinc concentrate, zinc metal, lead metal, cadmium metal, silver metal, and sulfuric acid and captive power plants.

Spot silver prices hit an 11-year high recently, $32.15 per ounce; this is a 25% (YoY) rise. Zinc prices too are on the rise and talks of $3000/tonne are on the Street. Zinc is being buoyed by the broader flow of investment money into the base metals sector. But the zinc narrative has also changed with focus shifting from smelter constraints to mine supply issues. On the domestic  front, Zinc prices rose to Rs.276.90/kg in the futures trade amid a pick-up in spot demand. Marketmen said the widening of positions by participants, following a pick-up in demand from consuming industries kept zinc prices higher in the futures trade.

Metal prices are on the rise following China’s announcement to revitalise its property sector which is expected to boost demand. And data shows that demand recovery is gaining globally.

Hind Zinc has ended Q4FY24 with a 21% (YoY) drop in net profit at Rs.2038 crore on a 12% drop in revenue at Rs.7285 crore. Lower zinc and lead prices, lower volumes from lead largely contributed to the decline though higher zinc and silver volumes as well as prices, stemmed further decline. With metal prices now on the surge, obviously it is expected that Hind Zinc will reap benefits which will get reflected in the stock price.