HZL share price: Vedanta group stock down 15% in 6 months; should you buy Hindustan Zinc?

Shares of Hindustan Zinc Ltd (HZL) are down 15 per cent in the past six months. But if one were to go by Antique Stock Broking, it is still not a 'Buy'. The domestic brokerage expects India’s infrastructure investments, rising domestic steel production, and increased use of galvanized steel to drive 8 per cent year-on-year (YoY) growth in domestic zinc demand. It also believes a revival in Chinese domestic consumption will support a stable zinc price outlook.

Antique said capacity expansion, firm zinc and silver prices, and lower costs are likely to boost profitability for the Vedanta group firm. While Antique valued HZL at 9 times estimated EV/Ebitda for FY28 to suggest a 'HOLD' rating on the stock, its target price for HZL at Rs 660 hinted at 24 per cent potential upside over the prevailing price.  

On Tuesday, the stock was down 1.27 per cent at Rs 533.50.

HZL has plans to set up a 250 ktpa integrated zinc metal complex at Debari for a capex of Rs 12,000 crore. Its board has also approved the setting up of India’s first tailings (waste residue) reprocessing plant. 

This facility would have a capacity of 10 mtpa and will extract zinc and silver from the large waste stockpile accumulated at Rampura Agucha mines. Besides, HZL has won three new critical mineral blocks.

HZL's FY27 growth capex guidance stands at $500-600 million, focused on commissioning the Hot Acid Leaching plant and the fertilizer plant. Capex also covers the integrated zinc metal complex and the tailings reprocessing plant. The Hot Acid Leaching plant is expected to produce 27 tons of silver and 6,000 tons of lead per annum from the smelting waste at Dariba. 

At the end of FY26, the company reported gross investments, cash and cash equivalents of Rs 13,850 crore (up 48.2 per cent QoQ), and total outstanding borrowings of Rs 8250 crore (down 8.4 per cent QoQ), leading to net cash of Rs 5,590 crore.

Antique said the world’s largest integrated zinc producer and the sixth top producers of silver is eyeing two times growth and diversification into critical minerals. 
It said the June quarter average LME zinc prices were up 31.2 per cent  YoY and 7 per cent sequentially and LME lead prices were up marginally, with rupee also depreciating for the month.

"Zinc inventory levels at LME warehouses are higher by 5.3 per cent YoY and 4.1 per cent QoQ though global zinc market is forecasted to be in a slight deficit during 2026 as per International Lead and Zinc Study Group. HZ reported 1QFY27 (provisional) saleable metal production of 260 KT (up 4 per cent YoY) and silver production of 149 tons (down 0.4 per cent YoY)," Antique said.

For FY27, the HZL management is targeting mined metal production of 1,150 KT, up 3.2 per cent YoY growth. It is looking at refined metal production of 1,100 KT (4.9 per cent YoY growth) and silver production of 680 tons (8.5 per cent YoY growth). 

"MCX Silver prices have corrected QoQ but are still 16 per cent above our FY27 estimate (silver segment contributed 45 per cent to FY26 consolidated Ebit). The Hot Acid Leaching plant and 510 ktpa fertilizer plant is
expected to be completed by 2QFY27. We maintain HOLD rating at a target of Rs 660 (target multiple of 9.0x FY28E EV/Ebitda," Antique said.