In the domestic market, silver hit its new peak at Rs 2,83,598/kg.
Hindustan Zinc ranks among the world’s top five silver producers, with an annual capacity of around 800 tonnes. Silver is a key earnings driver for the company, contributing about 38% to its EBIT.
Safe-haven demand has strengthened in recent sessions amid escalating tensions between the US and Iran, along with reports that Federal Reserve Chair Jerome Powell was threatened with criminal indictment by the Trump administration over his Congressional testimony.
What should investors do?
“Hindustan Zinc has delivered a robust performance over the past month, gaining more than 10%. From a technical perspective, the stock remains in strong bullish momentum and is trading above all key moving averages and critical support levels, indicating sustained strength over the long term,” Sachin Gupta, VP-Research of Choice Equity Broking, told ETMarkets.
Momentum indicators such as the RSI are in positive territory, reinforcing the presence of bullish sentiment in the near term. Considering the current market momentum, traders are advised to adopt a buy-on-dips strategy for this stock, Gupta added. Any decline towards the Rs 610–Rs 605 zone could present a good buying opportunity, with strong support placed around the Rs 578 level. On the upside, the stock has the potential to test resistance levels of Rs 650 and Rs 670 in the coming sessions.Last month, international brokerage firm Jefferies initiated coverage with a Buy call and a target price of Rs 660 per share. That’s an upside of 5% from current market levels.
Hindustan Zinc stands out as a key beneficiary of rising silver and zinc prices, supported by its first-decile zinc mining costs. While volume growth is expected to remain modest, earnings are projected to expand sharply, with EPS growth of 22% in FY26 and 29% in FY27, followed by a further 7% increase in FY28, Jefferies said in a note.
Hindustan Zinc has seen a sharp improvement in cost efficiency, with reported zinc cost of production (excluding royalty) declining from a peak of $1,257 in FY23 to $1,002 in 1HFY26. The reduction has been driven by better ore grades, higher use of domestic coal, softer global coal prices and a rising contribution from renewable energy, Jefferies said. Looking ahead, the company expects costs to remain largely range-bound through FY26–28E, as efficiency gains and increased renewable power usage are likely to offset pressures from deeper mining and variability in ore grades.
Strong cash generation and healthy return on equity underpin this outlook, with FY26–28 EPS estimates 9–31% higher than Street expectations.
(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)
