Hindustan Zinc Reports 35% Growth in Q2 Profit Despite Exceptional Loss

Vedanta-owned Hindustan Zinc reported a 35% increase in net profit for the July-September period, reaching ₹2,327 crore (approximately $280 million). This result exceeded the ₹2,256 crore ($272 million) predicted by a CNBC-TV18 poll, despite an exceptional loss of ₹83 crore ($10 million) during the quarter.

The company's revenue for the quarter rose by 22% year-on-year to ₹8,252 crore ($993 million), surpassing the CNBC-TV18 poll estimate of ₹7,979 crore ($960 million). Higher zinc LME prices and a sequential recovery in silver volumes contributed to the topline growth.

Hindustan Zinc's Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) increased by 31% from the same quarter last year to ₹4,123 crore ($496 million). Analysts had anticipated a figure of ₹3,139 crore ($378 million).

The EBITDA margin for the quarter expanded by 380 basis points to 50%, aligning with CNBC-TV18 poll expectations.

Higher silver volumes and reduced zinc production costs offset the impact of lower lead prices. A sequential decline in production costs also supported the margin improvement.

Shares of Hindustan Zinc climbed to the highest point of the day, recovering all losses following the results announcement. The stock is currently trading 1.1% higher at ₹514 ($6.18). Year-to-date, the stock has risen 61%, despite being down 36% from its peak of ₹807 ($9.71).