Hindustan Zinc Share Price Jumps 12% as Silver Rally Lifts Earnings

Hindustan Zinc share price has rallied over 12% in recent sessions, making it one of the strongest performers in the metal space. The stock touched intraday highs today in the ₹560–₹565 range, moving closer to its 52-week high of ₹567.

This rally is not driven by speculative momentum alone. Instead, it reflects a powerful combination of record silver prices, supportive global monetary conditions, and strong Q2FY26 financial performance, positioning Hindustan Zinc as a direct beneficiary of the ongoing global silver upcycle.

Why Hindustan Zinc Share Price Is Rising

The primary trigger behind the stock’s surge is the sharp rally in global silver prices, which have nearly doubled over the past year. A severe supply crunch that intensified in October 2025 caused by low Chinese inventories, strong exports to London, and rising industrial demand has tightened the global silver market.

Adding to this momentum, the US Federal Reserve’s third rate cut has boosted investor appetite for precious metals. A weaker US dollar and a relatively softer rupee have further enhanced realizations for exporters and commodity producers like Hindustan Zinc.

For the company, silver is not a marginal contributor. It accounts for 40–45% of EBIT, making earnings highly sensitive to silver price movements.

Silver Price Surge and Its Impact on Hindustan Zinc

Silver prices have surged to record highs, crossing ₹2 lakh per kg in India in on December 12, 2025 and nearing $50 per ounce globally. Demand from solar energy, electric vehicles, and AI-linked electronics has structurally altered the silver demand profile.

Hindustan Zinc benefits disproportionately from this trend. A large part of its silver production is unhedged, meaning the company can sell volumes at prevailing spot prices after fulfilling earlier hedged contracts at lower levels. This has resulted in a strong earnings tailwind as silver prices moved sharply higher.

Analysts estimate that nearly 88% of silver price gains flow directly into EBITDA, making Hindustan Zinc one of the most leveraged listed plays on the silver cycle in India.

Q2FY26 Results: Margins, Costs and Profit Growth

Operational performance has reinforced the macro tailwinds. In Q2FY26, Hindustan Zinc reported a 13.83% year-on-year rise in net profit to ₹2,649 crore, supported by robust margins of around 52% EBITDA.

Revenue grew 3.6% YoY to ₹34,083 crore, aided by higher commodity prices and record mined metal production of 258 kilotonnes. A key highlight was cost control zinc production costs fell to $994 per tonne, a five-year low, helping offset softer zinc prices globally.

For FY25, the company delivered ₹17,400 crore in EBITDA at margins of about 53%. If silver prices remain elevated, according to media reports, analysts project EBITDA could reach ₹22,000 crore by FY27, driven largely by silver’s growing share in profits.

Hindustan Zinc’s Silver Production Advantage

Hindustan Zinc is the world’s third-largest silver producer, with annual output of around 22.5 million ounces, placing it ahead of several global peers. Unlike pure silver miners, the company benefits from zinc and lead operations, where silver is produced as a high-margin by-product.

The company is also investing for the future. Expansion plans include adding 250 kilotonnes of refined metal capacity at the Debari smelter, aimed at meeting long-term demand from clean energy and technology sectors through 2030.

This combination of scale, low costs, and by-product economics positions Hindustan Zinc uniquely to ride what many analysts describe as a structural “silver wave.”

Zinc and Lead Trends: A Secondary but Stable Support

While silver dominates the earnings narrative, zinc and lead remain important. Global zinc prices declined in recent quarters due to oversupply and weak construction demand. However, Hindustan Zinc’s low cost base and higher volumes have helped protect margins.

Lead prices remain range-bound, offering limited upside compared to silver, but continue to support base earnings stability. Overall, silver’s bull run has more than compensated for softness in base metals.

Risks to Watch: Valuation and Promoter Pledge

Despite strong fundamentals, investors should monitor key risks. The stock now trades near its 52-week highs, making near-term volatility possible if silver prices cool.

Additionally, over 90% of promoter holdings are pledged, which could amplify downside risk during sharp market corrections, even though the company maintains a strong balance sheet.

What Lies Ahead for Hindustan Zinc Stock

Hindustan Zinc’s recent rally reflects a clear shift in how the market views the company from a traditional zinc producer to a strategic silver-linked play. With silver contributing nearly half of EBIT and demand drivers looking structural rather than cyclical, earnings visibility remains strong as long as prices stay elevated.

For investors seeking exposure to the global silver upcycle with the comfort of scale, dividends, and cost leadership, Hindustan Zinc stands out as a rare, high-quality proxy in Indian markets.