Hindustan Zinc shares experienced a significant rally on Friday, January 23, climbing over 6% to touch a record high of ₹709.95. The surge was driven by silver prices scaling fresh all-time peaks, benefiting from rising geopolitical risks and growing concerns around US economic and policy stability. As one of India's largest silver producers, Hindustan Zinc has emerged as a key beneficiary of the ongoing precious metals rally.

Silver Prices Hit Record Highs

Silver prices extended their remarkable rally on Friday, with MCX silver futures jumping nearly 4% to hit a fresh all-time high of ₹3,39,927 per kilogram. In international markets, silver climbed 2.5% to $98.60 per ounce, moving closer to the psychologically important $100 level. The sharp move was supported by multiple factors including a weaker US dollar, escalating geopolitical tensions, and renewed concerns around Federal Reserve independence, all boosting safe-haven demand for precious metals.

Global Market Drivers

Market sentiment has been shaped by a combination of geopolitical and macroeconomic developments. While US President Trump recently softened earlier warnings about trade tariffs on European nations, a separate agreement on Greenland tensions included US missile deployment, mining rights grants, and stronger NATO security presence. Investors are also tracking US monetary policy developments, with markets awaiting Trump's announcement on the next Federal Reserve chair following concluded interviews. Expectations of more dovish leadership have strengthened bets on additional interest-rate cuts, as lower rates typically support non-yielding assets like silver and gold.

Strong Stock Performance

Hindustan Zinc's stock performance reflects the strength of the silver-led rally across multiple timeframes:

Record Q3FY26 Financial Results

Hindustan Zinc reported robust Q3FY26 earnings that comfortably beat Street expectations across all key metrics. The strong performance was driven by record production, firm commodity prices, and significant cost reductions.

Key Financial Highlights

The company achieved its highest-ever quarterly revenue and profit, supported by higher metal output, stronger zinc and silver prices, and substantial cost improvements. Zinc cost of production (excluding royalty) dropped to a five-year low of $940 per tonne, declining 10% year-on-year due to lower power costs and higher by-product realisations.

Operational Performance

Operationally, Hindustan Zinc delivered record third-quarter performance with mined metal production of 276 kilo tonnes and refined metal production of 270 kilo tonnes. Silver output increased 10% sequentially, with silver accounting for nearly 44% of total EBIT during the quarter, underscoring its growing importance to overall earnings.

Analyst Outlook

IIFL Capital maintains an 'ADD' rating on Hindustan Zinc with a target price of ₹712, implying approximately 5% upside from current levels. The brokerage values the company at 10x EV/EBITDA and notes that every $10 per ounce change in silver prices impacts the company's fair value by around ₹59 per share.

Key Investment Highlights

• EBITDA rose 36% quarter-on-quarter and 35% year-on-year, 8% above consensus estimates
• Zinc production costs fell to five-year lows at $940 per tonne
• EBITDA margins expanded 310 basis points to 55.1%
• Expected volume growth of 2.5% CAGR over FY26-FY28
• Projected EBITDA growth of 15% CAGR driven by silver prices

IIFL Capital expects silver to stabilise at structurally higher levels around $60 per ounce, despite near-term volatility. Strong cash flows are expected to support elevated dividend payouts of around 3%. Key risks include sharp falls in silver prices, global economic slowdown, and potential stake sales by Vedanta or the government.

Hindustan Petroleum Corporation Ltd. (HPCL) recorded a significant block trade on the National Stock Exchange (NSE), highlighting substantial institutional activity in the oil marketing company's shares. The transaction represents one of the notable large-volume trades in the energy sector.

Block Trade Details

The block trade executed on NSE involved substantial volume and value, demonstrating significant investor interest in HPCL shares.

Transaction Significance

Block trades typically involve institutional investors, mutual funds, or large stakeholders looking to execute substantial transactions without impacting regular market prices. These transactions are executed through special trading mechanisms that allow for large-volume trades.

The price of ₹427.95 per share for this transaction indicates the valuation at which institutional participants were willing to transact in HPCL shares. The substantial volume of 458,420 shares suggests significant institutional participation in the oil marketing company.

Market Impact

Such large-volume block trades often reflect institutional portfolio adjustments or strategic investment decisions. The execution of this ₹19.62 crore transaction demonstrates continued institutional interest in India's energy sector, particularly in established oil marketing companies like Hindustan Petroleum Corporation Ltd.

The block trade mechanism ensures that large transactions can be completed efficiently without causing excessive volatility in the regular trading sessions, benefiting both institutional participants and retail investors.