Hindustan Zinc Share Price Targets As Vedanta-promoted Firm Beats Q4 Estimates

Hindustan Zinc Ltd (HZL) shares are successful attraction aft nan Vedanta-promoted mining and resources shaper of zinc, lead, metallic and cadmium reported a 47 per cent year-on-year (YoY) summation successful consolidated nett profit for nan March quarter, reaching Rs 3,003 crore — its highest-ever fourth-quarter profit, surpassing Street estimates. The grounds capacity was supported by a crisp simplification successful accumulation costs, which declined to a 16-quarter debased of $994 per metric tonne. Revenue for nan 4th roseate 20 per cent YoY to Rs 9,087 crore, nan highest ever recorded by nan company.

MOFSL said Hindustan Zinc's March 4th capacity was been amended than its estimates, aided by nan company’s attraction connected costs control. HZL continued to attraction connected improving accumulation pinch tight cost-control measures, it said adding that nan brokerage has mostly retained its net estimates for FY26-27 and expects Hindustan Zinc to prolong its profitability. 

"The favorable pricing script could besides support nan earnings. At CMP, HZL trades astatine 7.7 times FY27 EV/Ebitda, and we judge nan existent valuation prices successful each affirmative factors. We reiterate our 'Neutral' standing pinch a target value of Rs 460 (premised connected 8 times EV/Ebitda connected FY27 estimates," it said.

HZL said its net earlier interest, tax, depreciation and amortisation (EBITDA) came successful astatine Rs 4,816 crore, up 32 per cent YoY. The Ebitda separator expanded by 500 ground points to 53 per cent, driven by beardown operational ratio and effective costs management.

Analysts noted that Hindustan Zinc is successful nan last stages of preparing for nan adjacent shape of growth, wherein it plans to grow mined metallic capacity from 1.2mtpa to 1.5 mtpa successful nan first shape by FY28 on pinch matching refined metallic capacity. Thereafter, it would look to raise mined metallic capacity to 2 mtpa. 

The specifications connected nan capex are apt to beryllium revealed by July-August. The guidance is assured of a excavation life 25-plus years moreover astatine expanded capacity, and does not foresee immoderate consequence to mines’ renewal aft 2030.

Nuvama said Hindustan Zinc's Q4 Ebitda was better-than-expected owed to little refined zinc costs of accumulation (CoP). Higher measurement and little zinc CoP offset little zinc price, it said. 

"That said, we are cutting FY26E/27 Ebitda by 5.4 per cent/3.7 per cent to facet successful little zinc-lead and metallic measurement growth. We are factoring successful a 9 per cent Ebitda CAGR complete FY25–27E amid higher measurement and little CoP. The guidance is moving connected raising mined metallic capacity successful phases to 2 mtpa (1.5mtpa successful first phase) complete adjacent 5 years. Valuing HZl astatine 8 times FY27E EV/Ebitda yields target of Rs 403 (earlier Rs 411); clasp ‘REDUCE’," Nuvama said.
 

Published on: Apr 28, 2025 9:10 AM IST