Shares of Hindustan Zinc Ltd fell 2.4 percent to Rs 488 on Monday even as its chief executive officer Arun Misra told CNBC-TV18 that silver prices are expected to remain elevated at least until next year and could climb to as much as $50-55 per ounce.
Misra said the strong run-up in silver prices has been driven by both industrial and investment demand, citing the growing use of silver in renewable energy and electronics manufacturing, along with a flight to precious metals amid global uncertainties. The company has hedged silver at $37/oz, which he said should be fully exhausted by next year.
He added that Hindustan Zinc aims to produce 680 tonnes of saleable silver in FY26 -- implying a major ramp-up in the second half of the year after producing 293 tonnes in the first half. “We are putting all bets in one place to produce more silver,” Misra said, adding that the output in the second half could translate to an annualised rate of about 760 tonnes, a record level for the company.
On zinc, Misra said prices are likely to move towards $3,000-3,100 per tonne, supported by strong demand in India and abroad, and a pick-up in Chinese smelter activity.
He also said that Hindustan Zinc plans to announce next month a capacity expansion towards 2 million tonnes, including a new 650-kilotonne-per-annum smelter (450 ktpa zinc and 200 ktpa lead).
The company expects its cost of production to fall further to about $950/t from $990/t, helped by increased renewable energy use -- targeted to rise from 19 percent to 25 percent by year-end -- and operating leverage as output scales up.
Misra reiterated his support for demerging the silver business, calling it “a step in the right direction” that would unlock value. “Had we done this a year back, by now we would have reaped the benefits of a much higher market cap of both companies,” he said.
Silver prices globally have cooled from their recent highs after a sharp rally that saw the metal touch an all-time high of $54/oz last week before falling to around $51.5/oz. On the MCX, silver was trading around Rs 1.56 lakh per kg, about 8 percent below its record.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
