HINDZINC - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 My Thought Process

You're asking for a full-spectrum fundamental analysis of Hindustan Zinc Ltd (HINDZINC), with a numeric rating and strategic investment guidance. I see you're focused on long-term value and timing an entry, so I’ve weighed profitability, capital efficiency, valuation, and business durability to give you a clear verdict.

📊 Fundamental Analysis of Hindustan Zinc Ltd

🔍 Core Financials

Profitability

PAT Qtr: ₹2,204 Cr vs ₹2,976 Cr — decline of 26%, but still solid.

EPS: ₹24.0 — strong earnings base.

ROE: 72.4%, ROCE: 60.7% — exceptional returns, among the highest in the industry.

Leverage & Liquidity

Debt-to-equity: 0.82 — moderately high, but manageable given strong cash flows.

Dividend Yield: 6.38% — highly attractive for income-focused investors.

Cash Flow

Operating cash flows remain robust, supported by consistent profitability and high-margin zinc operations.

Dividend payouts are frequent and generous, with ₹10/share interim dividend announced in June 2025

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📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 18.9 Undervalued vs industry PE of 30.5

P/B Ratio ~14.5 High — reflects premium on earnings, not assets

PEG Ratio 7.38 Very high — growth not justifying price

Intrinsic Value ~₹420–₹440 Slightly below current price — mildly overvalued

⚒️ Business Model & Competitive Edge

Segment Leadership: India’s largest integrated producer of zinc, lead, and silver — ~75% market share

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Moat: Resource ownership, cost-efficient mining, and scale.

Growth Drivers

Rising demand for zinc in infrastructure, batteries, and alloys.

Silver production adds a valuable revenue stream.

Sustainable mining practices and ESG focus.

📈 Technical & Entry Guidance

Current Price: ₹455

DMA 50/200: ₹440 / ₹450 — trading above both, indicating strength.

RSI: 59.4 — neutral to bullish.

MACD: 7.07 — positive momentum.

🎯 Entry Zone

Ideal Buy Range: ₹430–₹445 — near DMA support.

Stop Loss: ₹410

Target: ₹500–₹520 in medium term

🕰️ Long-Term Holding Outlook

Hold if invested: Strong fundamentals, high dividend yield, and sector leadership.

Buy on dips: Especially near ₹440 zone.

Growth Triggers: Silver output, zinc demand, and dividend continuity.

⭐ Fundamental Rating

4.5

Let me know if you’d like a peer comparison with Vedanta or Hindalco next!

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