Hindustan Zinc Q1 Results Review - Performance Inline; Guidance Retained: Motilal Oswal

Motilal Oswal Report

Hindustan Zinc Ltd.’s Q1 FY24 revenue came in at Rs 73 billion (down 22% YoY), which was in line with our estimate of Rs 74 billion.

Ebitda stood at Rs 33 billion (down 35% YoY), in line with our estimate of Rs 33 billion. The decline in Ebitda was attributed to lower London Metal Exchange prices that were partially offset by lower cost of production.

The CoP dipped to $1,194/tonne in Q1 FY24 from $1,214/tonne in Q4 FY23. The decline in CoP was driven by benefits from higher coal linkages, softening coal prices, better ore grades and a strong operational performance.

Adjusted profit after tax stood at Rs 20 billion (down 37% YoY) in line with our estimate of Rs 19 billion.

Refined zinc sales for Q1 FY24 stood at 208 kilo tonne (up 1% YoY), refined lead sales came in at 50 kt (down 7% YoY) and silver sales stood at 179 tonne (up 1% YoY).

Hindustan Zinc posted the highest ever Q1 mined metal production aided by higher ore production at Kayad and Rampura Agucha mines, improved metal grades and better-than-expected mill recovery.

Refined lead production was hit by low plant availability, which indirectly impacted silver production adversely QoQ in Q1 FY24.

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