Hindustan Zinc (HZL), a major producer of zinc and silver, is expected to declare a special dividend of Rs 6,000 crore this month, according to a report by a newspaper citing industry sources. This anticipated announcement follows the National Company Law Tribunal’s (NCLT) recent approval to transfer Rs 10,383 crore from the company’s general reserves to retained earnings.
Sources indicate that HZL’s board is likely to meet within the next two weeks to finalize the dividend. The company has so far declined to comment on the matter, and we have not independently verified the report.
The proposed special dividend would translate to Rs 14.2 per share, supplementing the regular annual dividend. Vedanta, which holds a 64.92 percent stake in Hindustan Zinc, could receive Rs 3,895 crore, potentially helping the company reduce its debt. The government, which owns a 29.54 percent stake, is expected to receive Rs 1,772 crore.
The NCLT’s Jaipur bench issued the order on July 16, allowing the reclassification and transfer of funds. As of March 31, 2024, Hindustan Zinc reported total reserves of Rs 14,350 crore and total debt of Rs 8,722 crore.
In the fiscal year ending March 2024, Hindustan Zinc distributed Rs 5,493 crore in dividends. The previous fiscal year saw a record payout of around Rs 32,000 crore, with the government receiving Rs 9,500 crore.
Hindustan Zinc shares have surged by 87 percent in 2024, far outpacing the Sensex’s 11 percent gain. The company’s market capitalization more than doubled during the June quarter, adding nearly Rs 1.6 lakh crore. For the quarter ended June, Hindustan Zinc reported a 12 percent year-on-year increase in revenue to Rs 8,130 crore, a 17 percent rise in EBITDA, and a 19 percent growth in profit after tax, reaching Rs 2,345 crore.
The company also generated Rs 3,432 crore in free cash flow from operations during the same period. Hindustan Zinc Limited (HZL) is a prominent player in the global mining industry, primarily engaged in the extraction and production of zinc, lead, and silver.
As one of the world’s largest integrated producers of zinc and a significant producer of lead and silver, HZL operates some of the most advanced mining and smelting facilities in India. The company is a subsidiary of Vedanta Limited and is headquartered in Udaipur, Rajasthan.
Hindustan Zinc is committed to sustainable mining practices, focusing on environmental stewardship, resource efficiency, and community development. With a strong emphasis on technological innovation and safety, HZL continues to play a crucial role in meeting the growing global demand for zinc, which is essential for galvanizing steel and other industrial applications.
