Why Hindustan Zinc Share Price is Falling

Today, 18 June 2025, the Indian stock markets opened with some cautious optimism before dipping into the red amid the ongoing geopolitical tensions in the Middle East.

At the time of writing, the Nifty 50 was trading at 24,8790, down 0.25%. The BSE Sensex was trading at 81,350, down 0.3%.

IT stocks showed gains, while pharma and metal sectors were under pressure. The pharma index was down 2% and metal index was down 1%.

A stock that has fallen sharply in trade today is Hindustan Zinc.

Here are reasons for the same...

#1 Promoter Stake Sale

Vedanta, the promoter of Hindustan Zinc, is planning to offload shares worth around Rs 75 billion (bn) through block deals.

This stake sale is expected to be offered at a discount of up to 10% to the previous closing price. The discount price offered when compared to the market price tends to push the market price lower to adjust.

Also, the increase in supply in the market and reduction in promoter holding tends to negatively impact stocks. These factors have led to a drop in the stock of Hindustan Zinc.

#2 Stock Goes Ex-Dividend

While the fall in the stock on 18 June can be attributed to block deals at a discount, the stock of Hindustan Zinc also fell yesterday (17, June). This can be attributed to the stock going ex-dividend.

The board of the company had fixed the ex-dividend date as 17 June, 2025 for a dividend of Rs 10 per share.

Shares tend to correct by about the amount of dividend declared on the ex-dividend date.

What Next?

Hindustan Zinc announced plans to double it's capacity of zinc, lead, and silver production.

This expansion aligns with the strong anticipated growth in demand both in India and abroad over the next few years.

The company has approved a project for setting up new 250 ktpa integrated smelter at Debari along with mines & mills expansion across the mines. The project is targeted to be completed in a period of 36 months with an overall cost of Rs 120 bn.

Silver prices have seen a sharp rise since the start of the year. Hindustan Zinc tends to benefit significantly from rising silver prices because it is India's largest silver producer. It is also one of the world's top integrated silver producers.

The company derives both silver and zinc from the same mines, allowing it to optimise production based on market demand and prices for these metals.

Industrial demand for silver, especially in emerging sectors like electric vehicles (EVs) and 5G technology, is expected to increase, supporting a long-term bullish outlook on silver prices.

Hindustan Zinc also produces other products like lead and sulphuric acid and operates captive power plants to support its mining and smelting activities.

In short, Hindustan Zinc is expected to benefit from rapid expansion and increase in prices. In the short term, promoter stake sale is likely to be a negative for the stock price.

How Shares of Hindustan Zinc have Performed Recently

Over the last one month, the share price of Hindustan Zinc has gained 2.7% from Rs 449.1 to current levels of Rs 461.1. In the past one year, shares of the company have fallen 28%.

The stock hit a 52-week high of Rs 717.1 on 8 July 2024. The stock also hit a 52-week low of Rs 378.65 on 3 March 2025.

About Hindustan Zinc

Hindustan Zinc is one of the world's largest and India's only integrated zinc producer. It is a subsidiary of Vedanta. The Government of India retains about 27.92% ownership.

Hindustan Zinc is also one of the top five silver producers globally.

The company operates a fully integrated zinc business that includes lead-zinc mines, hydrometallurgical zinc smelters, lead smelters, pyrometallurgical lead-zinc smelters, sulphuric acid plants, and captive power plants primarily located in Rajasthan and Uttarakhand.

Its mining operations span five districts in Rajasthan-Udaipur, Chittorgarh, Bhilwara, Rajsamand, and Ajmer-and one district in Uttarakhand.

To know more, check out Hindustan Zinc's fact sheet and latest quarterly results. You can also Hindustan Zinc with its peers on our website.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...