Hindustan Zinc shares are expected to attract significant attention in Wednesday's trading session following a 6% decline in silver prices to approximately $73 per troy ounce. The drop comes as investors engaged in year-end profit booking near record highs, despite both silver and related metals remaining on track to close 2025 with historic annual gains.

Silver's Exceptional Performance in 2025

Silver has delivered remarkable returns of 157% in 2025, with prices surging to around $82 at spot levels. The rally has been driven by multiple factors including expectations of aggressive monetary easing, heightened geopolitical risks, and robust investment demand. Key triggers supporting the surge include low supply conditions, rising demand, and an easing monetary policy cycle by central banks globally.

Hindustan Zinc's Strategic Position

Hindustan Zinc holds a prominent position as one of the world's top five silver producers, with an annual production capacity of approximately 800 tonnes. Silver represents a significant profit driver for the company, contributing nearly 38% of its EBIT. This substantial exposure positions the company as a direct beneficiary of silver price movements.

The company has demonstrated strong stock performance, delivering gains of 41% in 2025 and 28% over the past month. With nearly 37% of its second half FY26 silver volumes hedged at $37, most of the upside from higher prices is expected to flow through in FY27, providing a meaningful boost to EBITDA.

Analyst Outlook and Projections

Jefferies initiated coverage on Hindustan Zinc with a Buy rating and a target price of ₹660. The brokerage views the company as a clear beneficiary of higher silver and zinc prices, supported by its first-decile zinc mining costs. While volume growth is expected to remain modest, earnings momentum is projected to stay strong.

The stock currently trades at 9.2x FY27E EV/EBITDA, above its long-term average of 7.3x. However, Jefferies believes this premium is justified given silver's rising share in overall profitability.

Operational Efficiency Improvements

Hindustan Zinc has achieved significant cost efficiency improvements. Zinc cost of production, excluding royalty, has declined from a peak of $1,257 in FY23 to $1,002 in the first half of FY26. This improvement has been driven by better ore grades, increased use of domestic coal, softer international coal prices, and a growing share of renewable energy.

The company has assumed conservative silver prices of $56-60 for the second half of FY26 through FY28, which are approximately 3-10% below prevailing spot levels. This conservative approach provides potential upside if silver prices remain elevated.

Market Outlook

Experts believe silver remains structurally well-supported despite entering a consolidation phase. Motilal Oswal Financial Services maintains a buy-on-dips approach with a staggered investment strategy. The firm notes that silver's 2025 rally is being driven by real metal scarcity rather than speculative positioning, with physical deficits, policy-driven supply restrictions, and concentrated inventories increasingly dictating prices.

Hindustan Zinc Limited has informed stock exchanges about a penalty levied on its promoter company Vedanta Limited by tax authorities. The latest disclosure was made on December 30, 2025, in compliance with regulatory requirements under SEBI Listing Regulations.

Updated Regulatory Disclosure Details

The company filed the disclosure pursuant to Regulation 30 read with Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Specifically, the disclosure was made under Clause 20 of Para A of Part A of Schedule III, which pertains to material events that could impact the company.

Promoter Company Impact

Vedanta Limited, which serves as both the promoter and holding company of Hindustan Zinc Limited, received the penalty from the office of Joint Commissioner, CT & GST Circle, Jharsuguda. This represents an updated disclosure following the earlier penalty notification from Bangalore authorities. The penalty details were disclosed by Vedanta Limited to the stock exchanges on December 30, 2025.

Compliance and Transparency

The disclosure demonstrates continued adherence to regulatory transparency requirements. Hindustan Zinc Limited has ensured that all stakeholders are informed about material developments affecting its promoter company that could have implications for the subsidiary.

Document Availability

The complete disclosure documentation is accessible through multiple channels for investor reference. The information has been made available on the websites of both BSE and NSE, as well as on Vedanta Limited's dedicated investor relations portal at https://www.vedantalimited.com/eng/investor-relations-stock-exchange-announcements.php .

The disclosure was signed by Aashhima V Khanna, Company Secretary and Compliance Officer of Hindustan Zinc Limited, ensuring proper authorization and compliance with corporate governance standards.