Hindustan Zinc becomes India’s most valued metals company amid silver price rally; m-cap crosses Rs 3 lakh crore

A dramatic tripling in silver prices over the past year has propelled Hindustan Zinc Ltd to the top of India’s metals pack in terms of market capitalization. The rally has boosted the company’s valuation to around Rs 3.2 lakh crore, helping it overtake several major competitors, including its parent company, Anil Agarwal-led Vedanta.Shares of Hindustan Zinc, one of India’s largest producers of the white metal, rose more than 6% in Friday’s session, pushing gains this year to above 15%. The increase pushed the company’s market value past Rs 3.2 lakh crore, marginally higher than rival JSW Steel Ltd. The stock eventually ended the day at Rs 699 on the BSE, up 4.66%.

Hindustan Zink is among the leading silver producers, with annual production of 22.5 million ounces – ahead of Grupo Mexico’s 12.1 million ounces and not far behind top players such as Fresnillo with 52.5 million ounces and Newmont with 28 million ounces. The company also operates in the lowest quartile of the global zinc cost curve and has a mine life of approximately 25 years.

Can investors buy?In a recent report, HSBC upgraded the stock to Buy from Hold and increased its price target to Rs 750 per share, implying an upside of over 12% from current levels. The brokerage values ​​Hindustan Zinc at 11x FY27E EV/EBITDA, compared to 9.5x previously, putting it at the top end of its five-year trading range of 5-11x. The valuation reflects the company’s strong balance sheet and stable to improving outlook for LME zinc and silver prices. “We see further upside profit potential from spot zinc and silver prices on LME,” HSBC said.

IIFL Capital, following the company’s Q3 earnings last week, initiated coverage on Hindustan Zinc with an Add rating and a target price of Rs 712. Management maintained its silver volume guidance for FY26 at 680 tonnes (±10 tonnes). While production costs in the third quarter were $940 per tonne, full year cost expectations remain at $950-1,000 per tonne, reflecting higher mine development activity and quality volatility.

For FY26, capex is estimated at $700 million, split between $400 million for maintenance and $300 million for growth, with capex expected to increase further in FY27 and FY28 to support expansion.

Hindustan Zinc Q3 snapshot

The company reported its highest-ever revenue and profit growth in the third quarter, supported by 4% year-on-year growth in mined metal production. The consolidated net profit of the Vedanta business rose 46% to Rs 3,916 crore, compared to Rs 2,678 crore in the same period last year.The company’s total revenue from operations in Q3FY26 was also the highest ever quarterly revenue at Rs 10,980 crore, up 27% from Rs 8,614 crore in the corresponding quarter of the last fiscal.

Mined metal production in the quarter under review amounted to 276 kilotons, remaining the highest ever in the third quarter. It was a 7% quarter-on-quarter growth.

Profit after tax (PAT) rose 48% quarter-on-quarter, while total revenue rose 28% sequentially.

Also read: IndusInd Bank Q3 results: PAT declines 89% YoY to Rs 161 crore; NII drops 13%

Hindustan Zinc reported in its filing with the stock exchanges that quarterly production costs were the lowest in five years at $940 per tonne, which is 5% better quarter-on-quarter and 10% better year-on-year.

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