Hindustan Zinc jumps nearly 4%; why Jefferies cut its target

Hindustan Zinc shares climbed nearly 4% to Rs 560 on the NSE on Wednesday morning, October 21, after the Vedanta Group company reported a 142% year-on-year increase in consolidated net profit for the July–September quarter of FY27. Economic Times Markets reported that Jefferies retained its Buy recommendation but reduced its price target to Rs 650 from Rs 750.

The company announced the results on Monday, reporting net profit of Rs 6,412 crore, against Rs 2,649 crore a year earlier. The share price is a reported morning snapshot, not a live market quote.

Higher prices and production lift earnings

Revenue from operations rose 76.5% to Rs 15,093 crore from Rs 8,549 crore in the corresponding quarter last year. The report attributed the increase to higher metal prices, greater metal production, improved by-product realisations and a stronger dollar. Total expenses increased more slowly, rising nearly 31.5% to Rs 6,895 crore.

Earnings before interest, tax, depreciation and amortisation, or EBITDA, increased about 108% to Rs 9,285 crore. The reported EBITDA margin widened to 62% from 52%, a gain of 10 percentage points.

Silver was a significant contributor: net silver sales rose 141% to Rs 4,111 crore, while zinc sales increased 54% to Rs 8,224 crore. Lead sales grew 35%, and sales of other metals rose 151%.

Why a strong quarter did not prevent a target cut

Jefferies said September-quarter EBITDA exceeded its estimate by 8%, helped by lead concentrate sales and lower production costs. It raised its FY27 earnings-per-share estimate by 5%, but cut its FY28 and FY29 estimates by 4% because of lower silver price assumptions.

The brokerage highlighted silver price volatility since June 2026 and warned that rising interest rates could exert near-term pressure. Its forecasts assume silver prices of $50 for the rest of FY27 and for FY28 and FY29, roughly 13% below the cited spot price of $58.

That caution did not amount to a wholly negative view of silver. Jefferies said its global analysts remained positive on the metal over the medium term, citing fiscal pressures and inflation risks as support for precious metals. It nevertheless identified a recovery in silver prices as important to Hindustan Zinc’s stock performance.

The target is a forecast, not an assured return

The revised Rs 650 target implied roughly 21% upside from the previous NSE closing price of Rs 538.4—not from Wednesday morning’s higher price of Rs 560. Jefferies continued to favour JSW Steel and Welspun Corp within the metals sector.

The reported rally followed a weaker recent run: Hindustan Zinc shares had fallen more than 9% over a month and about 12% in 2026, while remaining approximately 11% higher over a year. The brokerage’s target and earnings estimates are forward-looking assessments, rather than guaranteed outcomes or a BharatVox investment recommendation.