HINDZINC

Returns to Net Cash, Eyes Bumper Q4

(HZL), the Vedanta Group’s cash cow, posted its highest-ever quarterly profit of ₹3,916 crore in Q3FY26, up nearly 50% YoY. The strong performance was driven by a sharp rally in silver prices and lower production costs, which lifted margins and enabled the company to return to a net-cash position after recent dividend payouts had pushed it into net debt. Silver accounted for nearly half of profits, underscoring its growing importance in HZL’s earnings mix. Silver as Key Driver - Silver contributed 44% of profits. - Average silver price: $54.73/oz, up 74% YoY; December hit a record $64.34/oz. - HZL hedged 55 tonnes at $37/oz, limiting Q3 gains, but positions now squared off. - FY26 silver output guidance: 680 tonnes; Q4 could be bumper if 229 tonnes are delivered. Revenue and Profit Growth - Consolidated revenue: ₹10,980 crore, up 27% YoY. - Net profit: ₹3,916 crore, record high, nearly 50% YoY growth. - EBITDA boosted by commodity cycle and operational efficiency. Zinc and Lead Performance - Prices steady: Zinc $3,165/t (vs $3,050 YoY), Lead $1,970/t (vs $2,007 YoY). - Margins supported by lower costs despite stable pricing environment. Cost Efficiency Gains - Cost of production: $940/t, lowest in five years, down from $1,041/t YoY. - 9M FY26 average cost: $980/t, vs $1,073/t YoY. Balance Sheet and Outlook - Net cash: ₹329 crore (Dec 31) vs net debt of ₹2,547 crore (Sep 30). - Strong cashflows expected to sustain capex and dividends. - Analysts highlight potential record Q4 if silver guidance is met and hedges no longer cap upside. - Operational excellence and commodity tailwinds position HZL for continued strength.