Hindustan Zinc Ltd., a Vedanta group company, has reported strong operational performance in the third quarter of the current fiscal year, with mined metal production rising 4% despite a slight decline in silver output. The world's largest integrated zinc producer demonstrated resilience across its core operations while maintaining its leadership position in global markets.

Production Performance Overview

The company's quarterly production metrics reflect a mixed but generally positive performance across different segments:

Metal Production Breakdown

The company's saleable metal production during the third quarter showed robust growth, with specific contributions from different metal categories:

The 4% increase in mined metal output to 2,76,000 tonnes was primarily attributed to higher ore production, demonstrating the company's operational efficiency improvements. This growth builds upon the previous year's third quarter output of 2,65,000 tonnes.

Energy Generation and Sustainability

Hindustan Zinc's renewable energy initiatives showed positive momentum during the October-December quarter. Wind power generation increased by 5% to 50 million units, benefiting from favorable wind velocity conditions. This improvement aligns with the company's sustainability commitments and operational cost optimization strategies.

Market Position and Global Reach

Hindustan Zinc maintains its position as the world's largest integrated zinc producer and ranks among the top five silver producers globally. The company's extensive market presence includes:

• Supply operations spanning more than 40 countries
• Dominant market share of approximately 77% in India's primary zinc market
• Strategic positioning in global zinc and silver markets

The company's diversified production portfolio and strong market presence continue to support its operational performance despite minor fluctuations in specific metal categories like silver production.

Hindustan Zinc shares snapped their four-day gaining streak on Monday, December 29, falling 3.2% to ₹616.60 as silver prices declined over 8% after extending their record run to hit an all-time high of $68 per ounce. The stock dropped 6% from its intraday high of ₹656, reflecting the volatility in precious metal markets.

Silver's Historic Rally and Correction

Silver prices have delivered an extraordinary performance, beginning the year below $30 and rising more than 170% with three trading sessions remaining. This positions the white metal for its best calendar year performance since 1979, when it gained 200%.

On the MCX, silver prices declined 8% from the intraday high of ₹2.54 lakh per kg, highlighting the significant correction after the record-breaking rally.

Market Dynamics and Supply Constraints

Speculative inflows, industrial demand, and supply deficits have been the primary drivers powering silver prices higher. Analysts indicate that trading positions on paper are now being covered with physical volume, creating a supply shortage to meet demand requirements.

Peter McGuire, CEO of trading.com, emphasized the momentum's strength, stating it remains too early to consider shorting silver. "If you would have told me that this time last year, I would have laughed, and I would have said I don't think it can get there, but now it has, and we have got a couple of days left of trade, so we might even punch out 180%," McGuire told CNBC-TV18.

Hindustan Zinc's Market Position

Vedanta's subsidiary Hindustan Zinc remains India's only listed silver play, with promoter Vedanta maintaining a 61.9% stake as of the September quarter. At the day's highs, the company commanded a market capitalization exceeding ₹2.7 lakh crore.

December Rally and Future Outlook

The stock has gained 40% year-to-date, with most gains concentrated in December as silver prices surged. The recent correction reflects the inherent volatility in precious metal markets, though the underlying supply-demand dynamics continue to support elevated price levels.

With trading momentum remaining strong and supply constraints persisting, market participants are closely monitoring whether silver can maintain its historic gains through the remaining trading sessions of the year.