Hindustan Zinc has distinguished itself as a top performer among the recent additions to the Nifty Next 50 index, enjoying a robust 13 percent increase since the National Stock Exchange (NSE) announced the restructuring on August 22.
In anticipation of its official inclusion on September 30, the stock surged from ₹425 to ₹483 by Tuesday, bolstered by strong trading volumes, favorable sector dynamics, and significant institutional investments.
Among other newcomers to the index, Mazagon Dock and Siemens Energy saw gains of 2 percent and 1 percent, trading at ₹2,751 and ₹3,424, respectively, while Solar Industries experienced a decline of 10 percent, moving from ₹14,845 to ₹13,350.
The index reorganization introduced four new companies, while InterGlobe Aviation, Swiggy, Dabur, and ICICI Prudential Life Insurance were removed from the index.
On September 29, silver prices on MCX futures reached an unprecedented high of ₹144,179 per kg. According to an Emkay research report, silver comprises approximately 20-25 percent of Hindustan Zinc’s revenue but constitutes 35-40 percent of its EBITDA, thereby serving as a critical driver of profit margins. A $1 per ounce change in silver prices correlates with a 1 percent fluctuation in EBITDA, as 88 percent of silver revenue directly enhances profitability due to its production as a by-product of zinc.
The hike in Hindustan Zinc’s stock price reflects broader advances in the Nifty Metal index, driven by rising prices of both bullion and base metals. The company’s trading volumes have surged ahead of its index inclusion, as passive funds and institutional investors rebalance their portfolios. Analysts note that while peers like Fresnillo and Grupo Mexico have been positively reassessed this year due to their silver exposure, Hindustan Zinc continues to trade at a relative discount, which may allow for potential further re-rating as its silver narrative develops.
Last fiscal year, Hindustan Zinc registered an EBITDA of ₹17,400 crore with margins of 53 percent, a figure projected to rise to ₹22,000 crore by FY27, contingent upon the sustainability of current silver prices. With an annual silver production of 22.5 million ounces, the company now stands alongside prominent global players such as Fresnillo and Newmont.
Published on September 30, 2025.
