Vedanta Group Stock Could Jump To Rs 610, Analysts Say The Silver Boom Will Drive 24% Upside

Hindustan Zinc Ltd. (HZL) has been analyzed by brokerage B&K Securities, which has set a "BUY" rating target price of Rs 610 based on FY28E forecasts of 9x EV/EBITDA multiple for the Zinc and Lead sectors and 15x EV/EBITDA for the Silver segment.

The target suggests a potential rise of 24.5% from the closing price of Rs 490 dated December 8. The brokerage bases its opinion on HZL's cost efficiency, metal volumes, and the increasing significance of silver to earnings.

The research study claims that expectations of additional cost optimization bolster HZL's investment case. It is anticipated that the company's yearly zinc production costs would drop from USD 1,052 per tonne in FY25 to USD 1,000 in FY26.

The brokerage highlighted the mining company's cost-effectiveness by stating that "HZL's zinc production cost of US$ 994/tonne (2QFY26) ranks it among the lowest-cost producers globally, ~30% lower than the global peer average of US$ 1,300-1,400/tonne.

According to the research, HZL's standing as one of the world's most cost-effective manufacturers is expected to be reinforced by improvements in metal grades, volume growth, and power cost cuts.

The brokerage also draws attention to HZL's long-term growth initiative, "Hindustan Zinc 2.0," which intends to double the metal major's integrated refined metal capacity by 2030, from around 1.2 mtpa to 2 mtpa. Zinc, lead, and silver production would be significantly improved during the next five years, with an estimated total capital investment of Rs 250-300 billion.

The company's silver portfolio, which is anticipated to continue being a major factor in profitability, was also emphasized by the brokerage. The fourth-largest producer of silver in the world, the corporation has a long-term expansion plan to boost its capacity for refined silver from 800 tpa to 1,500 tpa. B&K Securities went on to say that because silver has so many industrial uses worldwide, the firm will profit from a projected global silver deficit.

"We initiate coverage on the stock with a Buy rating and a target price of Rs 610, based on 9x EV/EBITDA multiple for the Zinc and Lead segments and 15x EV/EBITDA for the Silver segment on FY28E estimates. This implies a 22.5% upside from the current market price, based on our base case scenarios of US$ 3,000/2,050 per tonne and 44/oz for Zinc/Lead/Silver. The stock is currently trading at 9x FY28E EBITDA," said the research analysts of B&K Securities in a report.

The investment rationale is driven by 2 factors which are industry-leading cost position provides competitive moat: HZL's zinc production cost of US$ 994/tonne (2QFY26) places it among the lowest-cost producers globally, -30% lower than the global peer average of US$ 1,300-1,400/tonne and transformative capacity expansion - "Hindustan Zine 2.0": HZL's Board approved Phase I of an ambitious growth strategy in June 2025 to double integrated refined metal production capacity from -1.2 mtpa to 2.0 mtpa over the next five years, with total capital expenditure estimated at Rs 250-300 bn.

The brokerage's "BUY" recommendation is based on its conclusion that HZL's cost leadership, incremental volume growth, and rising silver production support a favorable medium-term outlook, albeit highlighting China's demand slowdown and commodity price volatility as major concerns.

The largest integrated producer of zinc, lead, and silver in India, Hindustan Zinc (HZL) is a Vedanta Group firm that leads the Indian primary zinc market and has a substantial worldwide market share.

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