Sale of government’s entire stake in Hindustan Zinc Ltd cleared by Cabinet: Sources

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The Cabinet Committee on Economic Affairs (CCEA) on May 25 approved a proposal to sell the government’s entire stake in Hindustan Zinc Ltd (HZL), sources told Moneycontrol.

The Cabinet has also approved a proposal to close Bharat Gold Mines Ltd, said a source.

However, the government has not yet made these decisions by the Cabinet and CCEA official.

The Union government, with its 29.5 percent stake, is an ordinary shareholder in Hindustan Zinc, which is promoted by Vedanta Limited. The Anil Agarwal-led Vedanta holds a 64.92 percent stake in the zinc-lead miner. At the current market price, the government's residual stake in Hindustan Zinc is valued at around Rs 38,000 crore.

As per a Supreme Court order dated November 18, 2021, the Centre can sell its residual stake in HZL in the open market in accordance with SEBI rules. Sources say the Department of Investment and Public Asset Management (DIPAM ) plans to sell the government’s entire stake in Hindustan Zinc within this financial year.

Hindustan Zinc is one of the largest integrated producers of zinc and lead and a leading producer of silver. It has facilities in Rampura Agucha, Chanderiya, Dariba, Kayad and Zawar in Rajasthan, along with zinc-lead processing and refining facilities and a silver refinery at Pantnagar in Uttarakhand.

Closure of Bharat Gold Mines Ltd

According to a source, the Union Cabinet has also decided to close the Bharat Gold Mines Ltd (BGML). The company's operations have been shut since 2001. Recently BGML’s Kolar Gold Fields was in the news because of the Southern blockbuster film KGF Chapter 2. Around 50 percent of the movie was filmed at ‘Cyanide Gudda’, an area in the Kolar Gold Fields, in Karnataka’s Kolar district.

According to the source, the Cabinet has decided to transfer the majority of the land to the newly formed National Land Monetisation Corporation, while around 250 acres will be transferred to the Karnataka state government.

BGML, a public sector undertaking, was incorporated in April 1972 under the administrative control of the Department of Mines, with its office at KGF. The gold fields are strategically located — 90 km from Bengaluru airport, 260 km from Chennai Port, and 314 km from Krishnapatnam port. BGML has about 12,000 acres of land.