Hindustan Zinc's Q4 FY25 revenue of Rs 90.9 billion (+20.4%/+5.5% YoY/QoQ) was 4.3% above our estimate. Ebitda of Rs 48.2 billion (+32.1%/+7.1% YoY/QoQ) was 6.5% above our estimate. Ebitda margin improved by 471 bps/81 bps YoY/QoQ to 53% during the quarter. At 214kt, zinc volumes were higher by 5% QoQ but declined by 3.2% YoY. Zinc/lead prices averaged $2,838/tonne (+15.8%/-7.0% YoY/QoQ) and $1,970/t (-5.2%/-1.8% YoY/QoQ), respectively, during the quarter.
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Systematix Report
Hindustan Zinc Ltd. stands to benefit from growing demand from India's automotive, battery storage, and solar energy segments. We revise our FY26/FY27 Ebitda by -3%/-3% to factor in revised base metal volume and price assumptions. We assign a multiple of 7.6x to Hindustan Zinc's zinc and lead Ebitda and a higher multiple of 14x to the silver segment Ebitda based on-
a positive demand and price outlook,
its growing share in the company's Ebitda, and
Hndustan Zinc's growing share in the global silver market (ranked third largest silver producer globally).
However, we believe that the company's growth trajectory appears to be fully priced in and the growth hereon is hinged on meaningful volume growth from new expansions and their timely completion.
We assign Hinduatn Zinc a price target of Rs 466/share (Rs 463/share earlier), implying an upside of 5% from CMP. Maintain Hold.
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