Hindustan Zinc OFS opens for retail investors today; should you subscribe to it?

Hindustan Zinc OFS: After witnessing a strong demand from institutional investors, Vedanta Ltd-led Hindustan Zinc's offer-for-sale (OFS) shall open for subscription on Thursday, January 29. The issue was that non-retail investors subscribed a total of 142.02 per cent, hinting at strong demand from investors.

The OFS of Hindustan Zinc Ltd opened for non-retail investors on Wednesday, January 28. The issue is being offered at a floor price of Rs 685 per share. The stock settled at Rs 708.10 on Wednesday, falling 2.55 per cent for the day. Its market capitalization slipped below Rs 3 lakh crore mark. The stock has gained more than 55 per cent in the last two months.

Now, since the stock price of Hindustan Zinc is on a roll, thanks to the record-breaking and historic rally in the silver prices, investors are wondering if they should apply in this OFS or not. Analysts believe that the Hindustan Zinc OFS is majorly suitable for investors with high-risk taking capacity.

Kranthi Bathini, Director of Equity Strategy at Wealthmills Securities said that the rally in metals and metal stocks has been spectacular one but warrants caution as well. He is cautious on Hindustan Silver from medium to long-term performance, considering the secular rally in the silver prices.

"Investors with a high-risk appetite can consider participating in OFS from a short-term perspective. However, if one has a long-term view on Hindustan Zinc, buying on dips will be a prudent approach," Bathini said.

Echoing the similar tone, Mahesh M Ojha, Vice President Research & Business Development at Kantilal Chhaganlal Securities said that one can apply for the OFS but with some caution considering the global situations. There are some risks and if silver prices see some correction, the stock might perform in tandem. However, the rally in silver is likely to continue, thanks to global factors.

Vedanta, which held 6.18 per cent stake in Hindustan Zinc of December 31, 2025, is planning to sell up to 3.35 crore shares or 0.79 per cent of the total equity as per the base offer, and another 3.35 crore equity shares through a green-shoe option, taking the total OFS size to 1.6 per cent. Shares of Vedanta jumped 4.45 per cent to settle at Rs 737.10 in the previous trading session.

Other analysts see Hindustan Zinc as the proxy-play for silver, which has been on a roll lately. The precious metal has delivered astounding multibagger returns to the investors, which has more than doubled post Diwali.

If silver prices continue to sustain at an elevated levels of $80-100/ounce for next 6-12 months, then there is scope for the company to report robust earnings growth over next 2-3 quarters and re-rating can continue. Retail investors may take small exposure via OFS, to ride on the exponential rise in zinc and silver prices, said Sunny Agrawal, Head of Fundamental Research at SBI Securities.

"One must note this investment is high risk high return bet on global cyclicals and is only suitable for experienced investors, who understands the importance of diversification in the portfolio and can timely exit the stock, if the pricing environment deteriorates for commodities including Zinc and Silver," he cautioned.

On the other hand, Anil Agarwal-led Vedanta has decided to exercise the oversubscription option in the offer-for-sale to the extent of 1.4 crore shares of Hindustan Zinc, in addition to the base offer size of 3.35 crore shares, on January 29. The total offer size will increase to 4.75 crore shares, representing 1.13 per cent of the paid-up equity.

From a retail investor’s perspective, the Hindustan Zinc OFS warrants a cautious and nuanced reading. While it remains a strong operating asset with meaningful exposure to zinc and silver, markets tend to look beyond commodity cycles and focus closely on promoter behaviour and capital allocation discipline, said Harshal Dasani, Business Head at INVasset PMS.

"Despite silver prices rising sharply over the past 18 months, Hindustan Zinc has not consistently outperformed its non-ferrous peers, highlighting that commodity tailwinds alone are insufficient," he added. The broader copper cycle remains structurally strong and relative performance in metals is ultimately driven by both the asset and the jockey," he adds.