Hindustan Zinc Ltd Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Amit Dixit - ICICI Securities Limited - Analyst : Yeah. Hi, good evening, everyone, and congratulations for a good performance. A couple of questions from my side. The first one is that the Pyro plant was run on led mode during the quarter. Now, led prices were relatively subdued. So, was it to exhaust the existing inventory that we might have since SK mine production was also a little bit lower, as mentioned in the press release. Or was it to take advantage of the higher silver prices, and what would be the mode of operation going ahead?

Question: Amit Dixit - ICICI Securities Limited - Analyst : Okay. That's very helpful. The second question is essentially on the cost of production. Now, this quarter we also saw a very good control on cost, cost went further down. And now it is basically a little bit above the mid-range of what we guided for the year. Now, going ahead, since coal prices might just remain soft, I mean, you will get the other cost advantage also because volumes are expected to pick up. So why have we kept our cost of production guidance same, I mean, shouldn't we be revisiting it now or will we do it maybe at the end of third quarter or so?

Question: Amit Dixit - ICICI Securities Limited - Analyst : Okay. That's very helpful sir. Thank you and all the best.

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : Thank you sir for this opportunity. We had on the last call mentioned that we had appointed a consultant for expansion to 2 million ton mine run rate, and that report might be available by August, September. Would you be able to share highlights from the report and recommendations?

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : And how would that be linked to the exploration strategy because we'll also have to sort of enhance exploration? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 18, 2024 / 11:00AM, HZNC.NS - Q2 2025 Hindustan Zinc Ltd Earnings Call

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : And how would this be split across mines when we sort of target the 2 million ton run rate? What would be the contribution of Zawar, RD, and different mines?

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : Right sir. One more question was about, would you be able to highlight the sensitivity of your EBITDA to zinc and silver prices for a change of say $100 of zinc and $1 in silver.

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : That the $32 silver, you said that the zinc price need to be around $3,400, $3,500 for (multiple speakers) I actually did not follow that. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 18, 2024 / 11:00AM, HZNC.NS - Q2 2025 Hindustan Zinc Ltd Earnings Call

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : Understood sir. And then probably the one more last question in terms of the zinc outlook, we had earlier expecting sort of zinc to reach $3,000. We are already at that level. So how do you see zinc progressing from here to the end of the financial year?

Question: Kirtan Mehta - BOB Capital Markets Ltd. - Analyst : Sure, sir. Thanks for these answers.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Hi. So thanks for the opportunity. A couple of questions first is do we have any hedges at this point in time for second half or for next fiscal?

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : And sir, anything for next fiscal?

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Nothing. Okay. My second question was any updates on Bamnia Kalan, specifically, it's a big one. How are we looking at it, any timelines?

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Alright, thank you. This is helpful. So third question is on Supreme Court mining judgment recently. Most of the companies -- basically they have spoken about hefty liabilities, but it's more work in progress. There is no clear cut understanding on what the quantification is. Sir, what is our take over here? I was just looking at our contingent liabilities -- is there's a number which is there, but would like to have your take on how we should understand or read this matter. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 18, 2024 / 11:00AM, HZNC.NS - Q2 2025 Hindustan Zinc Ltd Earnings Call

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : It's only INR83 crore, right? Also provided for -- that's right.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Okay. That's useful. Sir, just coming to a broader questions. Hindustan Zinc hasn't provided for the dividend date. Usually we see Hindustan Zinc going first and then Vedanta. Any specific reasons or not the right question.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Okay.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Correct. So normally it's us first and then basically Vedanta comes in.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Correct. Fair thing, fair thing. And sir, just three quick questions. Earlier, the company was planning to bifurcate the company into silver and zinc. Is it something which is on the table or is it on the back burner? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 18, 2024 / 11:00AM, HZNC.NS - Q2 2025 Hindustan Zinc Ltd Earnings Call

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Okay. And so there were talks about setting up a zinc smelter in Gujarat. Is it on the table or is it off?

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Okay. And lastly sir, you indicated a couple of numbers for DAP NPK production, possible to give some timelines over here, please.

Question: Ritesh Shah - Investec Bank (UK) Plc - Analyst : Q3, FY26. That's very useful. Thank you so much for the answers. I really appreciate it. Thank you

Question: Sumangal Nevatia - Kotak Securities - Analyst : Yeah, good evening, sir. I just have one question left. If you could please guide us on the capital structure and what sort of debt do we expect to see on the balance sheet on a steady state basis? So this question is because of the first half, we've given a substantial dividend. And now we are sitting on almost INR6,000 crore-odd of net debt. So are we open to I mean for the dividend requirements, et cetera, are we open to run a net balance sheet or this is just a timing thing, and we would have a close to a net debt zero balance sheet going forward? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 18, 2024 / 11:00AM, HZNC.NS - Q2 2025 Hindustan Zinc Ltd Earnings Call

Question: Sumangal Nevatia - Kotak Securities - Analyst : Understood. Just one more question, given we are talking about the very long term target of 2 million ton. We're losing two mines which is Zawar and (inaudible) in 2030 or we would be able to retain it because of our offer clause. Is it possible to share what sort of, I mean, cost escalation scenarios are we building it internally, given this expanded capacity will come in around that time itself, that would we would have to participate in the auction or at least match the highest bid?

Question: Sumangal Nevatia - Kotak Securities - Analyst : Understood. And just one last question. Given all our projects are working well, next year could we expect very close to our rated capacity of 1.2 million ton in terms of --

Question: Sumangal Nevatia - Kotak Securities - Analyst : Understood. All right. Thank you, sir and all the best.