### **Company Overview** Hindustan Zinc Limited (HZL), established in 1966 and headquartered in Udaipur, Rajasthan, is India’s only fully integrated producer of zinc, lead, and silver. A subsidiary of Vedanta Limited (64.9% stake), with the Government of India holding 29.5%, HZL is the **world’s largest integrated zinc producer** and ranks among the **top five global silver producers**. The company operates a vertically integrated value chain spanning mining, smelting, refining, and marketing, supported by captive power and digital infrastructure. HZL is a dominant force in India's metals and mining sector, commanding approximately **77% of the domestic primary zinc market** and **88% in lead**, while producing over **30% of its profits from silver**, a key strategic focus. --- ### **Operational & Production Status (Nov 2025)** - **Current Production Capacity:** - Refined metal: **1.1 million tonnes per annum (Mtpa)** - Mined metal: **1.2 Mtpa** - Silver refining: **~700–710 tonnes per annum** - **Recent Expansions (Oct 2025):** - **Dariba Cell House** capacity increased from **200 to 210 kiloamps**. - A similar upgrade at **Chanderiya Smelter** is underway, expected to add **25,000 tonnes of annual zinc output**. - These enhancements position HZL to exceed **1.125 million tonnes of metal production annually** in FY2026. - **Mine Life & Reserves:** - Over **25 years of mine life** supported by **13 million tonnes of metal reserves** and a **Reserves & Resources (R&R) base of ~453 million metric tons**. - **R&R base increased 3x since FY2020**, with ongoing efforts to expand it beyond **500 million tonnes**. --- ### **Strategic Growth Plan: Toward 2 Million Tonnes by 2030** HZL has outlined an ambitious, multi-phase expansion strategy to **double its production capacity to 2 million tonnes of metal annually by 2030**, with zinc and silver as twin growth engines. - **Phase I Expansion:** - Investment of **~₹12,000 crores** to build a **new 250 kilotonnes per annum (KTPA) integrated refined metal smelter in Debari**. - Accompanying expansion across **Rampura Agucha, Rajpura Dariba, Sindesar Khurd, and Zawar mines** to scale ore production from 19.3 Mtpa to **35.0 Mtpa**. - Mining capacity projected to rise to **1,510 KTPA**, and smelting to **1,169 KTPA** post-phase one. - **Total Capex:** - **₹30,000–35,000 crores ($3.6–4.2 billion)** planned over 3–5 years. - Estimated breakdown: **20% spent in FY25, 50% in FY26**, balance thereafter. - **FY26 Growth Capex:** $350–400 million; **Maintenance Capex:** $400 million. - **Production Outlook (FY2026):** - **Refined metal output:** 1.1 million tonnes - **Mined metal output:** 1.125 million tonnes - **Zinc cash cost (COP):** $1,025–$1,050/tonne - **Silver production:** 700–710 MT --- ### **Diversification & Strategic Shifts** #### 1. **From Commodity to Product-Centric Business** - Value-added products (VAPs) now constitute **~22% of sales**, up from 12% in FY2018. - Products: **CGG, EPG, ZAM, die-casting alloys**, and **HZDA series**. - High-margin alloys are engineered for **automotive, infrastructure, and construction sectors**. - **Hindustan Zinc Alloys Private Limited (HZAPL)** operates a **30 KTPA alloy plant**; generated ~₹93 crore EBITDA and on track for full-scale operation with a payback under 2 years. #### 2. **Entry into Fertilizers & Critical Minerals** - **Hindustan Zinc Fertilisers Pvt. Ltd.** is developing a **510 KTPA DAP/NPK plant** at Chanderiya, using **sulfuric acid by-products** from smelting. - Project to be commissioned by **FY2027**, reducing India’s imports and supporting **Atma-Nirbhar Bharat goals**. - **Critical Minerals Expansion:** - Acquired mining rights for **tungsten (Andhra Pradesh), potash (Rajasthan), and rare earth elements (UP)**—likely the **first private company in India** to secure rare earth (monazite) blocks. - Exploration partnerships established with **IIT Madras, JNCASR, and Serentica**, and international tenders issued for AI-led exploration in Chile, South Africa, and Australia. #### 3. **Demerger and Structural Flexibility** - A **potential demerger into zinc, lead, and silver business units** is under review, driven by **rising silver prices** and strategic portfolio clarity. - Zinc International acquisition **ruled out** due to **overlapping expansion plans**. --- ### **Innovation, Sustainability & Decarbonization** #### **EcoZen – Asia’s First Low-Carbon Zinc** - Launched in **Aug 2024**, EcoZen has a carbon footprint of **<1 tonne CO₂e/tonne of zinc**, **75% below global average**. - Marketed as a premium product to meet **LME green metal standards and CBAM regulations**. - ~8.5% (60,000 tonnes) of current production is EcoZen, expected to grow with renewable energy integration. #### **Renewable Energy & Energy Transition** - **530 MW Round-the-Clock (RTC) renewable power deal** with **Serentica Renewables**. - Fixed PPA for 25 years; supplies **70% renewable power by FY2028**. - Additional **450 MW group-captive solar-wind-storage project** underway (26% equity held via SPV). - Target: **50% renewable power by FY2026**; aiming for **firm renewable energy integration** by 2027. #### **Digital & Tech Transformation** - **AI & Automation:** - AI-driven optimization of non-fuel consumables in smelters. - **Remote-controlled loaders**, **tele-remote drilling**, and **IoT-based conveyor monitoring** deployed. - **NorthStar Analytics Platform** and **Digital Collaboration Centre** enable real-time data decisioning. - **Exploration Tech:** - Use of **LiDAR drones, hyperspectral imaging, AI/ML-driven 3D modeling**, and **cloud-based platforms (ARC GIS, Leapfrog)**. - Subsidiary **Hindmetal Exploration Services Pvt. Ltd. (HESPL)** holds **Category-A status (QCI-NABET)**. #### **Waste-to-Wealth & Circular Economy** - **Tailings Reprocessing Project (₹3,823 crores):** 10 million tonne capacity at Rampura Agucha to recover zinc and silver from legacy waste. - **Jarosite Utilization:** - Partnerships with **VEXL, CRRI, NEERI** to convert to cement additive (Jarofix). - R&D lab developing **Fe₂O₃ (hematite) from jarosite waste** (bench-scale validation). - **Zero Waste by 2030:** Focus on recovering zinc, manganese, silver from industrial waste. --- ### **R&D & Future Technologies** - Collaborations: - **IIT Madras & JNCASR** to develop **next-gen zinc-based batteries**. - **Aesir Technologies (US)** for **Nickel-Zinc (NiZn) batteries**—positioning HZL as a supplier to the **clean energy storage sector**. - R&D Spend (FY2025): **₹10.26 crore** - Two **Indian patents (IN 530897, IN 541547)** for silver recovery and waste utilization. - **2 US patents** for **paver blocks from waste** and **PAT production**. --- ### **Financial & Operational Excellence** - **Cost Leadership:** - Positioned in **first decile of global zinc cost curve**. - **COP reduced to $1,052/tonne (FY2025)**, targeting **$1,000/tonne**. - **EBITDA margin: ~50%**, stable across cycles. - **Hedging Strategy:** - Zinc hedged at **$2,872/tonne**; Silver at **$37/troy oz**. - In FY25, locked in **99 KTPA of zinc** at **$3,008/tonne**. - **Credit Profile:** **AAA rating (CRISIL)**, strong free cash flow, healthy balance sheet.