Hindustan Copper shares scaled fresh heights on Wednesday, jumping 6.7% to close at ₹434, marking the highest closing level since November 2010. The rally was part of a broader metals surge that also lifted Hindustan Zinc by 2.6% to ₹625, even as benchmark indices ended marginally lower.

Metal Stocks Outperform Broader Market

The Nifty Metal index gained 0.2%, bucking the broader market trend with the Nifty slipping 0.1%. Hindustan Copper's surge reflects the continued strength in copper prices, with the stock having gained over 17% in recent weeks amid a global supply crunch and accelerating demand from new-age sectors.

Copper Supply Crunch Drives Rally

Analysts attribute Hindustan Copper's surge to different metal-specific triggers. "There is a global supply crunch in copper, while demand has risen sharply," said Parthiv Jhonsa, vice president at Anand Rathi Institutional Equities. He pointed to rising consumption from electric vehicles, renewable energy, and AI-led data centres as key drivers pushing copper prices higher.

Jhonsa added that copper mining is becoming increasingly complex globally, giving Hindustan Copper an advantage as it can expand output by developing existing mines at relatively lower costs.

Silver Rally Boosts Hindustan Zinc

Hindustan Zinc's gains are increasingly linked to a sharp surge in silver prices, with the white metal hitting a record high of ₹2,27,000 per kilogram on Wednesday, surging by ₹9,750. The Vedanta-owned company is India's top silver producer.

"Silver is an important by-product for Hindustan Zinc, and higher silver prices materially support its revenues, margins and cash flows," said Sonam Srivastava, founder and CEO of Wright Research.

Exceptional Year-to-Date Performance

Both metal stocks have delivered outstanding returns, significantly outperforming broader market indices. The strong performance reflects investor confidence in the companies' ability to capitalize on favorable commodity price trends.

Beyond its traditional role as a precious metal, silver is seeing growing usage in solar panels, electronics and electric vehicles, tightening the demand-supply balance. This trend, combined with Hindustan Zinc's strong balance sheet and steady cash generation, has made it a preferred play in the current metals upcycle.

Hindustan Copper has witnessed a significant reduction in institutional holding as Life Insurance Corporation of India (LIC) trimmed its stake by 2.014% amid a stellar stock performance. The country's largest insurer reduced its shareholding to 4.072% from 6.086% through strategic market sales executed between August 16 and December 23.

Strategic Divestment Details

The transaction involved the sale of warrants/convertible securities rather than direct equity shares, with LIC disposing of approximately 1.95 crore securities during the four-month period. The gradual approach suggests a systematic profit-booking strategy rather than a single large transaction.

Stellar Stock Performance Drives Profit Booking

The divestment comes amid an exceptional rally in Hindustan Copper shares, which have surged 76% in 2025. The multibagger stock has consistently outperformed the broader metal sector, delivering remarkable returns across multiple time horizons.

Strong Earnings Back Stock Rally

The company's robust financial performance has supported the stock's upward trajectory. Hindustan Copper reported an impressive 85% surge in consolidated net profit for the September quarter, reaching ₹186.02 crores compared to ₹101.67 crores in the corresponding period of the previous year.

Technical Indicators Signal Overbought Conditions

The year-long rally has pushed the stock into strongly overbought territory, with technical indicators showing RSI at 78 and MFI at 87. Values above 70 are typically considered overbought, suggesting potential for consolidation or correction in the near term.

Regulatory Compliance and Market Impact

The disclosure fulfills LIC's obligation under SEBI Regulation 29(2) of the Substantial Acquisition of Shares and Takeovers Regulations, 2011. As a major institutional investor, LIC must report any changes crossing the 5% threshold or involving movements of 2% or more. The extended timeline of sales from August to December suggests a measured approach to minimize market disruption while capitalizing on the stock's strong performance.