Hindustan Zinc fell 2.76% to Rs 169.15 at 9:16 IST on BSE after net profit rose 8% to Rs 2149 crore on 25% decline in revenue to Rs 3070 crore in Q4 March 2016 over Q4 March 2015.
The result was announced at the fag end of the trading session yesterday, 21 April 2016.
Meanwhile, the BSE Sensex was down 27.06 points, or 0.10%, to 25,853.32 .
On BSE, so far 23,000 shares were traded in the counter, compared with an average volume of 2.16 lakh shares in the past one quarter. The stock hit a high of Rs 171 and a low of Rs 167.85 so far during the day. The stock hit a record high of Rs 199.80 on 31 March 2016. The stock hit a 52-week low of Rs 117.20 on 25 August 2015. The stock had underperformed the market over the past one month till 21 April 2016, rising 1.43% compared with 2.35% rise in the Sensex. The scrip had, however, outperformed the market in past one quarter, rising 23.19% as against Sensex's 8% rise.
The large-cap company has an equity capital of Rs 845.06 crore. Face value per share is Rs 2.
Hindustan Zinc said the decrease in revenue was on account of lower zinc volumes and LME prices, partly offset by higher volumes of lead & silver and rupee depreciation. Net profit rose helped by higher other income due to mark to market gains on investment income. Additionally, the provision for tax during the quarter was negative largely on account of substantial liquidation of investments at year end for payment of special dividend; the corresponding realised profits were set off by carried forward tax losses, significantly lowering the tax for the year.
The zinc metal cost of production per metric tonne (MT) before royalty stood at Rs 58044 ($853) in Q4 March 2016, higher by 4% from a year ago in dollar terms and 14% in rupee terms. The increase was due to lower production volumes from Rampura Agucha open cast mine in accordance with mine plan resulting in lower average grades. This was further accentuated by higher mine development, partly offset by lower coal & commodity prices. Looking at the recent commodity price downturn, the company has re-negotiated several contracts to optimize costs and expect this to translate into significant savings in year ending 31 March 2017 (FY 2017).
The company expects to reach the 1.2 million tonnes per annum (mtpa) mined metal production capacity within the next three years.
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Hindustan Zinc is a subsidiary of Vedanta (formerly known as Sesa Sterlite), a part of London listed Vedanta Resources plc, a global diversified natural resources company. The company is one of the largest integrated producers of zinc-lead and a leading producer of silver. As per the shareholding pattern, Vedanta holds 64.92% stake and the Government of India holds 29.54% stake in Hindustan Zinc as at 31 December 2015.
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