Silver has surged to a fresh record of $82 per ounce, putting Hindustan Zinc in the spotlight.
Why silver matters
Low supply, growing demand and easing monetary policies have pushed silver up this year. After touching the record, prices settled around $80 per ounce.
Hindustan Zinc’s silver exposure
The company is among the world’s top five silver producers, with about 800 tonnes of annual capacity. Silver contributes roughly 38% of its earnings before interest and taxes (EBIT).
Analyst view
Jefferies has started covering Hindustan Zinc with a “Buy” rating and a target price of ₹660, suggesting about a 4% upside. The stock is already up 44% this year and 28% in the past month.
- Higher silver and zinc prices are expected to boost earnings.
- EPS could grow 22% in FY26, 29% in FY27 and another 7% in FY28.
- Cash generation and returns are strong, with EPS estimates 9‑31% above most forecasts.
Cost advantages
Hindustan Zinc enjoys low zinc mining costs, ranking in the first decile globally. Production costs fell from $1,257 per tonne in FY23 to $1,002 in the first half of FY26, helped by better ore grades, more domestic coal and renewable energy use.
Costs are expected to stay stable through FY28 as efficiency gains offset deeper mining and ore quality changes.
What investors should watch
Silver is expected to stay in deficit, keeping prices supportive. The company has hedged about 37% of its 2H FY26 silver output at $37 per ounce, so higher spot prices could lift earnings, especially from FY27 onward.
Remember, this is my perspective, not a prediction. Do your own research before making any investment decisions.