Hindustan Zinc Limited — Investor Meet, 30-01-2025: Analysts/Institutional Investor Meet/Con. Call Updates

1. **Financial Performance:** Hindustan Zinc has reported a robust performance in the third quarter and nine months of FY25. The company achieved its highest-ever quarterly revenue of ₹8,614 crore, reflecting an 18% increase year-over-year. EBITDA also reached a record ₹4,539 crore, a 28% rise. Profit after tax climbed 32% to ₹2,678 crore. Notably, the cost of production (COP) for zinc was $1,041 per ton, a 5% year-on-year reduction, demonstrating improved operational efficiencies.

2. **Future Outlook and Growth Drivers:** Management is optimistic about market demand, projecting India will become the third largest zinc consumer globally due to expanding infrastructure and construction. A significant focus is on sustainability, with Hindustan Zinc aiming for a reduction of 0.5 million tons in CO2 emissions and increasing renewable energy usage, which they believe will bolster profitability amid rising zinc and silver prices.

3. **Order Book and Operational Updates:** Production of mine metal was 265,000 tons, up 3% sequentially, while refined metal production was slightly lower at 259,000 tons due to maintenance. Hindustan Zinc is confident in meeting its production guidance for the full year despite a challenging environment, and plans are in place for further expansions.

4. **Analyst Q&A Insights (Detailed):**

- **Revenue and Profitability:** Analysts inquired about the hedging gains and production impact from maintenance. Management confirmed a hedging gain of ₹58 crore and indicated that an additional 5-6 KT could have been produced without the shutdown.

- **Market Position and Competitive Landscape:** Analysts raised questions around the sustainability of zinc and silver prices, to which management responded affirmatively about favorable market conditions driven by strong demand for green technologies.

- **Operational Challenges or Risks:** Queries centered on geotechnical issues at the SK Mine, with management reassuring that they have mechanisms in place to address such challenges effectively.

- **Capex and Capital Allocation:** Analysts sought clarity on royalty payments, with management confirming an advance payment of ₹650 crore for FY25. They also discussed ongoing capital expenditures totaling ₹1,024 crore focused on expansion.

- **Strategic Priorities and Long-Term Vision:** Analysts expressed interest in the company's growth capex plans. Management outlined their phased approach to increase mined capacity, projecting a rise from 1.2 to 1.45 million tons by FY27.

5. **Market or Regulatory Updates:** No immediate regulatory updates were highlighted, but the company indicated active engagement in bidding for new mineral blocks under the critical mineral mission, suggesting a proactive approach to future opportunities.

6. **Strategic Focus Areas:** Management emphasized sustainability and efficiency in operations as core themes, reinforced by recognizing climate action efforts, aiming for a robust operational model that integrates green energy solutions.

7. **Investor Insight:** Hindustan Zinc's strong financial health, expanding market presence, and focus on operational excellence recommend a positive view for investors. With resilient demand forecasts and progressive cost management, the stock appears to be a prudent choice aligning with growth trajectories in the base metals market.