Hindustan Zinc's Two-Way Spinoff On The Cards, Says Chairperson — Exclusive

The company had initially examined a three-way demerger—where its zinc\lead, silver and recycling businesses would be independent units.

“We’re looking at demerger and the reason for this is purely taking our shareholders’ interests into account,” Priya Agarwal Hebbar, chairperson of Hindustan Zinc, told NDTV Profit in an exclusive interview at the Sindesar Khurd Mines near Udaipur in Rajasthan. 

So, if investors want to invest in just silver or just zinc or just technology, they have the choice to do that and that will bring these entities to their maximum potential, she said.

The company plans to keep its recycling business as a subsidiary. “We want to make the recycling business much bigger,” Hebbar said, adding that they want to be the biggest recycling company in the world because it is important for the future, for sustainability. 

The demerger currently awaits a nod from the Union government as it holds strategic stake in the company. The approval is expected to come by April this year.

Reducing Production Costs

Hindustan Zinc plans to reduce its production costs by curbing its carbon emissions. It plans to achieve this by switching to renewable power.

“In fact, we have tied up with Serentika Renewables for 450 MW of renewable power, which will take care of our energy needs,” Hebbar said. 

The energy transition—expected to take place in phases starting April 2024—will bring down its annual carbon emissions by 2.7 million tonne by June 2025. Currently, Hindustan Zinc sources its energy from captive power units. 

The company has guided for a fall in its production costs to $1,000 per tonne. The metric stood at $1,095 per tonne in the quarter ended December. 

In this regard, the company is betting on electrification and automation of its mining processes. Hindustan Zinc has automated ore mining using autonomous and remote controlled underground equipment, which can be operated from an on-ground control room.

Driving Diversity

Hebbar, who took over as the company's chairperson in 2023, is also driving change on the diversity front.

"When I joined the board, it was male dominated," she said. "Today, the board has five women."

She is also ensuring greater women participation at the mines. Over 500 women today work at the Sindesar Khurd Mines, which includes over 200 women engineers—or nearly 20% of its workforce. By 2030, she expects that to go up to 30%.

The government opened up mining jobs for women in the skilled category in 2019 and Hindustan Zinc was among the first to bring women in the workforce to work underground, she said.

If the unskilled category is opened up for women, it will hasten diversity in the company, she said, adding that it can even pave the way for employment of persons from the LGBTQ community.