Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

India’s Hindustan Zinc Limited (HZL) achieved record production levels in fiscal Q3 FY2021, ended Dec 30,2020, and expects to meet its mined metal and refined metal volume guidance for the fiscal year.


The company is on target to accomplish previously provided guidance for its mined metal and finished metal, full year 2021 production of 925,000-950,000mt for both zinc and lead. It also expects zinc production costs will remain under $1,000/mt and capex costs at $100-140mn for the year. The miner received environmental approval to expand capacity at its Zawar mine from 4mn mt to 4.8mn mt per year. The Chanderiya zinc smelter also increased throughput from 420,000mt to 500,000mt per year. During Q3, both back-fill plants were commissioned at Zawar mines. However, commissioning of the Fumer plant at Chanderiya was deferred in Q3 due to the COVID-19 pandemic.


The company increased its mined zinc production by 2pc in April-December 2020 to 684,000mt compared to 668,000mt during the prior year period. During this period, HZL’s refined zinc output rose 1pc to 520,000mt from 516,000mt while its refined lead output rose by 16pc to 153,000mt over 132,000mt in the same timeframe. Zinc sales remained flat at Rs97.2bn for the nine-month period. However, lead sales rose by 14pc, totaling Rs22.83bn crore in the nine-month period compared to Rs20.07bn crore in the same period in 2019.


Q3 FY2021

Mined metal output was up 4pc to 244,000mt in Q3 2021 compared to 235,000mt produced one year ago. The improvement is owed to increased ore production, though marginally offset by lower metal grades. Integrated zinc production increased by 2pc to 182,000mt in Q3 compared to 178,000mt one year ago. Integrated lead production rose by 28pc to 52,000mt in Q3 2021 against 41,000mt in Q3 2020. Zinc sales rose 21pc in Q3 2021 and tallied at Rs38.35bn compared to Rs31.65bn in Q3 2020. Lead sales increased 25pc in Q3 2021 to Rs8.17bn over Rs6.52bn a year ago.


HZL’s EBITDA rose 14pc to Rs78.65bn in the nine-month period compared to Rs68.88bn during the same period in 2019. The company’s EBITDA surged 45pc to Rs33.14bn in Q3 2021 above Rs22.88bn one year ago, due to increased revenue.


($1 = Rs72.94)

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