Group company reported a 44% year-on-year growth in its consolidated topline to Rs 9,387 crore.
High power and fuel costs meant that the company’s cost of production for zinc during the quarter went up by 23% year-on-year to Rs 97,423 per ton. However, the high prices of zinc, lead and silver throughout the quarter helped the company offset these costs.
Consequently, earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 44% on year to Rs 5,137 crore. Profit grew 56% to Rs 3,092 crore.
“With the exit run-rate for both mined and refined metal crossing over one million tonnes, we are fully geared to deliver another stellar performance this year,” said Arun Misra, the chief executive of Hindustan Zinc.
While the company delivered its best-ever quarterly earnings during the April-June period, the performance would likely be subdued in the subsequent quarters as the prices of the metals it produces have corrected over the past month.
Hindustan Zinc had been prioritising the production of zinc over lead and silver over the past couple of quarters given a sharp spike in the prices of zinc. However, with the prices of the metal correcting faster than lead and silver over the past one month, production of zinc has been reduced to normal levels.
The company has given guidance for capital expenditure to the tune of $125-150 million (Rs 1,000-1,200 crore) for the ongoing fiscal year.
This will include investment towards a new fertiliser plant, which got the board’s approval. The plant will require an investment of Rs 2,200 crore and will utilise the sulphuric acid generated as a by-product of metal production.
“We have to get rid of the acid we produce. Now, we can use it to make fertilisers,” Misra told ET.
As of June 30, 2022, the company had investments and cash and cash equivalents of Rs 24,254 crore as compared to Rs 20,789 crore at beginning of the quarter.
The stock of
closed 1.43% higher at Rs 283 on the BSE on Thursday. Sensex closed 0.51% higher.