Hindustan Zinc Q1FY26 Profit After Tax Declines 4.7% YoY Despite Strong Silver Segment Gains

Udaipur, July 18, 2025 – Hindustan Zinc Limited (NSE: HINDZINC) reported a 4.7% year-on-year decline in consolidated net profit for Q1FY26, with profit after tax (PAT) standing at ₹2,234 crore compared to ₹2,345 crore in Q1FY25. The company’s total income for the quarter came in at ₹8,050 crore, down from ₹8,398 crore a year earlier, reflecting pressures on topline and operating costs.

The silver segment supported earnings quality with ₹1,232 crore in segment results on ₹1,426 crore revenue, indicating high margin resilience. Wind energy also showed improved profitability. However, rising debt levels and a drop in capital employed signalled pressure on balance sheet strength.

Hindustan Zinc Stock Performance

As of 15:27 IST on July 18, Hindustan Zinc was trading at ₹435.05, down 0.47% from the previous close. The stock moved between ₹431.10 and ₹441.50, with a VWAP of ₹437.25. Volume stood at 45.49 lakh shares with a turnover of ₹198.92 crore.

Consolidated Financial Performance

*EBITDA approximated from EBIT & Depreciation data.

Segment-Wise Revenue and Results

The Zinc, Lead, and Silver segment contributed over 97% to total revenues:

Silver metal sales remained resilient, posting ₹1,426 crore in revenue, nearly flat YoY but delivering strong profitability of ₹1,232 crore in segment results. Wind energy posted modest revenue of ₹49 crore with improved profitability.

Key Ratios and Financial Indicators

• Operating Margin: 38% (flat YoY)
• Net Profit Margin: 29% (unchanged YoY)
• Debt-to-Equity Ratio: Increased to 1.19 from 0.84 YoY
• Interest Coverage Ratio: 16.25x vs 17.54x YoY
• Current Ratio: 1.11 (vs 1.24 YoY)

The company’s capital employed fell to ₹11,345 crore from ₹13,295 crore in Q1FY25.

Management Commentary

CEO & Whole-time Director Arun Misra stated:

“Despite a challenging macro environment, we maintained a robust operating margin of 38%. Our silver business continues to strengthen, contributing significantly to profitability. We remain confident in our long-term fundamentals.”

On the allegations raised by a short seller post-quarter, the management reaffirmed that all related transactions were commercially sound, approved, and legally compliant, requiring no adjustment in the financials.

Dividend Update

The Board had earlier declared an interim dividend of ₹10 per share, amounting to ₹4,225 crore, with a record date of June 17, 2025.

Strategic Updates

Hindustan Zinc infused ₹49 crore under the Power Delivery Agreement (PDA-3) with Serentica Renewables to secure 530 MW of round-the-clock renewable energy under a 25-year group captive model, reinforcing its commitment to sustainability.

Company Overview

Hindustan Zinc Limited, a Vedanta Group company, is India’s largest and the world’s second-largest integrated producer of zinc and lead. The company is listed on both NSE and BSE and is a key constituent of major indices. It also has significant operations in silver production and renewable energy.

REF:https://nsearchives.nseindia.com/corporate/HINDZINCNSE_18072025135031_OutcomeBM180725.pdf

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