Hindustan Zinc Stock Price Surges 13%, Hits 52-Week high After Positive China Data


by Sandip Das on 10 May 2024,  3 min read


Hindustan Zinc shares witnessed a surge of over 13 percent to hit 52-week high of Rs 520 per share on May 10. The trajectory of zinc prices was propelled by a notable uptick on the London Metal Exchange, where the commodity witnessed an impressive surge of over 2 percent, settling at $2,955. This surge was largely fueled by encouraging trade data emerging from China, a pivotal player in the global zinc market.

China’s trade figures for April showcased an encouraging narrative of growth, with both imports and exports witnessing an upward trajectory. This positive momentum not only signified a resurgence in domestic consumption but also underscored a revitalised appetite for overseas trade. Given China’s stature as a prominent consumer and producer of zinc, this resurgence in demand augurs well for the trajectory of zinc prices on the global stage.

The company stands to benefit significantly from the upward surge in zinc prices. This symbiotic relationship between market dynamics and corporate performance underscores the company’s strategic positioning within the industry landscape.

Furthermore, Hindustan Zinc announced the approval of an interim dividend of Rs 10 per equity share. This proactive measure not only reflects the company’s robust financial performance but also underscores its commitment to delivering value to its shareholders. The dividend payout, totaling Rs 4,225.32 crore, serves as a testament to the company’s strong cash reserves and prudent financial management practices.

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The company’s financial performance in the preceding quarter further reinforces its bullish trajectory. The company reported revenue at Rs 7,549 crore which surpassed market estimates, with margins soaring to 48.3 percent. Of particular note is the company’s commendable transition from a net debt position of Rs 370 crore in the preceding quarter to a net cash position of Rs 1,700 crore by the close of the March quarter.

The company anticipates a significant uptick in both mined metal and refined metal production, signaling its intent to capitalise on favorable market dynamics and meet burgeoning demand. Additionally, the company has earmarked a substantial capital expenditure ranging from $270 million to $325 million for the fiscal year, underscoring its commitment to expanding its operational capabilities and driving sustained growth.

Hindustan Zinc’s stellar performance amidst a backdrop of surging zinc prices underscores its resilience and strategic foresight. With a robust financial footing, prudent management practices, and a clear growth trajectory, the company is well-positioned to capitalise on emerging opportunities and deliver long-term value to its stakeholders.

Source: moneycontrol

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Disclaimer: The information provided in this blog post is for informational purposes only and should not be construed as investment or trading advice. The author is not a financial advisor and does not have any professional qualifications in this area. The author does not guarantee the accuracy or completeness of the information provided. Any action you take based on the information in this blog post is done at your own risk. Please consult with a financial advisor before making any investment

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