Hindustan Zinc rallies over 4%. But will the shine last?

Hindustan Zinc’s share price jumped over 4 per cent on Monday (June 9, 2025), reaching nearly Rs 525 per share.

The trigger? A board meeting scheduled for June 11 to consider the first interim dividend for FY26. Add a red-hot silver rally to the mix, and you’ve got the perfect storm for a price pop.

Why is the share price moving?

• Dividend bait: The company’s June 11 board meeting is expected to declare an interim dividend. The record date is June 17, drawing short-term investors chasing payouts.
• Silver rally: Silver prices are up sharply, trading above Rs 1.05 lakh per kilogram on MCX. This boosts realisations for Hindustan Zinc, India’s largest silver producer.
• Liquidity boost: The RBI’s surprise rate cut last week added fuel to the broader rally in cyclical and commodity-linked stocks.

Is the rally sustainable?

The stock has now gained over 25 per cent in the past month. But here’s the rub: Analysts are cautious. At nearly 21 times earnings, Hindustan Zinc isn’t cheap. And over 90 per cent of promoter holding remains pledged, a lingering risk.

Moreover, the company also has a history of frequent but sometimes unpredictable dividend declarations, which can be both a magnet and a trap for investors.

What the company does

A Vedanta subsidiary, Hindustan Zinc is India’s largest integrated producer of zinc, lead and silver. It also operates captive power plants and has been a regular dividend payer with one of the highest payout ratios among listed companies.

Below is a table summarising the company’s fundamentals.

Value Research Online ratings

• Overall: 3/5
• Quality: 9/10
• Growth: 6/10
• Valuation: 4/10
• Momentum: 1/10

The takeaway

Hindustan Zinc’s fundamentals are solid, and the silver upcycle adds a short-term tailwind. But at current levels, the upside could be limited unless global metal prices keep surging. Watch the board meeting outcome closely – if the dividend disappoints, the stock may give up 

Serious about wealth? So are we.

Join thousands of smart investors who rely on Value Research Stock Advisor for expert-picked stocks, time-tested strategies and long-term discipline.

Stop guessing. Start growing. Check it out now: Value Research Stock Advisor.

Disclaimer: This is not a stock recommendation. This story was created with the assistance of artificial intelligence and is intended for informational purposes only. Please take it with a pinch of salt and do your own research or consult a financial advisor before making investment decisions.