Hindustan Zinc's Q4 Net Profit Falls 21% Due to Global Zinc Price Slump

22 Apr 2024 , 06:59 AM

Hindustan Zinc Ltd (HZL), a Vedanta group firm, witnessed a 21% year-on-year decline in its fourth-quarter net profit, amounting to ₹2,038 Crore, primarily due to depressed zinc prices globally amidst slower demand growth compared to supply.

The company’s consolidated net profit in the same quarter of the previous year was ₹2,583 Crore. However, on a sequential basis, the net profit increased marginally by 0.5% from ₹2,028 Crore in the third quarter.

HZL’s revenue from operations in the reporting quarter stood at ₹7,285 Crore, reflecting a 12% decrease from ₹8,281 Crore recorded a year ago. Nevertheless, on a quarter-on-quarter basis, the revenue increased by 3%.

The consolidated earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter under review amounted to ₹3,637 Crore, marking a 14% decline from ₹4,208 Crore in the corresponding quarter last year.

The decline in revenue can be attributed to significantly lower zinc and lead prices, along with reduced lead volume, partially offset by increased zinc and silver volumes, silver prices, and favorable exchange rates, as stated by the company.

Despite plummeting metal prices, HZL maintained a steady margin of 47% through continuous cost reduction, achieving its lowest cost in the last three years, according to the company’s Chief Financial Officer Sandeep Modi.

For FY24, HZL reported record mined metal production of 1,079 kilotonne (KT), marking a 2% increase from the previous year, driven by improved mined metal grades.

Mined metal production in the March quarter reached 299 KT, up by 11% from the previous quarter, attributed to a combination of improved mined metal grades and higher ore production across mines.

Additionally, HZL achieved its highest silver volume in FY24 at 24.0 million ounces (moz), reflecting a 5% year-on-year increase. Refined lead production stood at 216 KT, up by 3% year-on-year, according to the company’s statement.

For feedback and suggestions, write to us at [e-mail]