NEW DELHI: Vedanta Ltd, the promoter of Hindustan Zinc Ltd (HZL), is reportedly planning to offload shares worth up to Rs 7,500 crore in HZL via block deals. The shares are expected to be offered at a discount of up to 10% to the last closing price.
On Tuesday, the shares of Hindustan Zinc fell 5.26% to close at Rs 485.95 on the NSE. In the last five trading sessions, the company's shares have plummeted by more than 9%. HZL commanded a market capitalisation of Rs 205,519 crore on Tuesday.
As of March 31, 2025, promoter shareholding in HZL stood at 63.42%. The central government holds a 27.94% stake in the billionaire Anil Agarwal-led Vedanta group company.
Last week, the board of HZL approved the first interim dividend of Rs 10 per equity share i.e. 500% on face value of Rs 2 per equity share for the financial year 2025-26. Vedanta will amass Rs 2,679 crore as dividend from Hindustan Zinc.
Vedanta Ltd has been aggressively pursuing deleveraging with the immediate target of bringing down EBIDTA to net debt ratio to 1 from1.2 in FY25. Vedanta Ltd's parent Vedanta Resources has has de-leveraged by over $4 billion in last three years.
Further, Hindustan Zinc board on Tuesday approved investing Rs 12,000 crore to expand its metal smelting and refining operations at the Debari (Udaipur) facility. The company said that the investment will go towards setting up new metal smelters with 250 kilo tonnes capacity per annum.
The investment, as per Hindustan Zinc, is part of its strategy to double the capacity of zinc, lead and silver. This expansion aligns with the strong growth in demand both in India and globally over the next five years, stated the company.
The project is targeted to be completed in 36 months and the company will use a mix of internal cash generation and debt to fund the expansion.
“We are excited to announce this 2x growth project towards doubling our capacity across zinc, lead and silver, which is strategically aligned with the country’s expanding economic landscape, increasing demand opportunities and keeping country self-reliant for Zinc. By closely matching the pace of national growth, we are confident that this will create significant value for our stakeholders and drive long-term success,” said HZL's Chief Executive Officer Arun Misra.
Hindustan is among the largest Zinc and Silver producing companies in the world. The company currently has a smelter capacity of 1,129 kilotonnes per annum and said that its existing capacity utilization stands at 93% as of FY25. The proposed addition of 250 kilo tonne capacity per annum will increase the company’s capacity by 22%.