Hindustan Zinc shares double in 1 month but the boom isn't so much about zinc

So what's driving this surge? While derives most of its revenues from zinc, the recent is largely attributed to the sharp surge seen in globally.

The company is India's only and after recording its highest-ever silver production in FY24, it has become the third-largest silver producer globally.

"The rally is predominantly to do with silver whose prices have hit fresh . For Hindustan Zinc, silver is a by-product and any price rise simply adds to its bottomline. The future outlook of silver continues to look bullish and the stock is being seen as a play on silver," Sunny Agrawal, Head of Fundamental Equity Research, , told .

In FY25, HZL's silver sales are expected to rise over 27% to Rs 6,840 crore. Silver accounted for about 19% of the company's total sales in FY24 with zinc occupying a bulk of over 60% share.

The company has given FY25 guidance for saleable silver production of 750 to 775 tons.

On , silver was trading above the Rs 94,000 mark and is seen as crossing the Rs 1 lakh milestone soon with developing industrial use cases like EVs, solar panels, 5G, etc. Silver prices are up around 20% so far in 2024.

In the middle of a , HZL also has plans to create two separate entities - one for zinc/lead and another for silver - while turning the recycling business into a subsidiary.

The Indian government, which owns a 29.54% stake in the miner, has told the company that the timing is not appropriate considering they are in the process of divesting the stake.

"However, looking at the rally of , we have spoken to the government and we feel that this is the right time for the government to disinvest and also help us to demerge these entities and create a silver as a separate entity because we continuously believe that it will unlock another $3 to $4 billion on the market cap," HZL CEO Arun Misra had told investors last month in a concall.
Anil Agarwal-controlled Vedanta holds a 64.92% stake in HZL.

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