Hindustan Zinc Limited (HZL), India’s largest integrated zinc producer, has contributed a whopping ₹87,000 crore to the national exchequer over the past five years, including ₹18,963 crore in FY25 alone, according to its latest corporate social responsibility and financial disclosures released on Monday.
The company, a subsidiary of Vedanta Ltd, plays a pivotal role in India’s mining and metals economy and is among the highest tax contributors in the private sector.
Key Highlights
✅ FY25 contribution: ₹18,963 crore
✅ 5-year total contribution: ₹87,000 crore
✅ Major payments: Royalty, taxes, GST, export duties, and dividend distribution tax
✅ HZL market cap: ₹1.38 lakh crore as of June 30, 2025
✅ Operations: Rajasthan (mines), Chhattisgarh (smelters), Gujarat (refineries)
Management Commentary
Arun Misra, CEO of Hindustan Zinc, said:
“HZL remains committed to nation building not just through metal production but via direct economic contribution, employment generation, and community development.”
He added that sustainable mining practices and value-added metal production will continue to strengthen the company’s financial contributions to India’s growth trajectory.
HZL’s Exchequer Contributions (Last 5 Years)
| Financial Year | Contribution (₹ crore) | YoY Change (%) |
|---|---|---|
| FY21 | 14,375 | -7.5 |
| FY22 | 16,220 | +12.8 |
| FY23 | 18,050 | +11.3 |
| FY24 | 19,392 | +7.4 |
| FY25 | 18,963 | -2.2 |
(Source: HZL investor disclosures)
Breakup Of FY25 Contributions
| Payment Head | Amount (₹ crore) | Share (%) |
|---|---|---|
| Corporate taxes | 6,382 | 33.6 |
| Royalties | 5,100 | 26.9 |
| GST & indirect taxes | 3,850 | 20.3 |
| Export duties | 1,241 | 6.5 |
| Dividend distribution tax | 2,390 | 12.6 |
| Total | 18,963 | 100.0 |
HZL Financial Performance Snapshot – FY25
| Parameter | FY25 | FY24 | YoY Change (%) |
|---|---|---|---|
| Total income | ₹35,980 crore | ₹34,800 crore | +3.4 |
| EBITDA | ₹19,870 crore | ₹19,150 crore | +3.8 |
| Net profit | ₹11,240 crore | ₹10,980 crore | +2.4 |
| Zinc production | 1.08 million tonnes | 1.06 million tonnes | +1.9 |
| Silver production | 715 tonnes | 694 tonnes | +3.0 |
(Source: Company annual report, audited consolidated results)
Operational Updates
- Underground mining capacity expansion: Rampura Agucha and Sindesar Khurd mines expanded to sustain production above 1.1 million tonnes annually.
- Silver refinery capacity enhancement: Enhancing value realisation from by-product silver.
- Digital transformation: Smart mining technologies and autonomous fleet deployment in underground mines.
Strategic Importance To Government Revenues
HZL contributes substantially to:
✅ Central government taxes and export duties
✅ State government royalties (Rajasthan earns highest mineral royalties among Indian states)
✅ Dividend income to the government, which holds a residual 29.5% stake in HZL
Analyst Views
Prasad Borkar, Analyst, Kotak Institutional Equities:
“HZL remains a strong cash generator with high EBITDA margins (~55%). Its financial discipline translates into consistent contributions to the exchequer alongside attractive shareholder returns.”
Sector Context: Metal Industry Exchequer Contributions
| Company | FY25 Contribution (₹ crore) |
|---|---|
| Hindustan Zinc | 18,963 |
| Coal India | 50,680 |
| NMDC | 10,520 |
| Vedanta (standalone) | 8,930 |
| JSW Steel | 7,640 |
(Source: Company filings, excluding indirect value addition and employment taxes)
Sustainability & ESG Initiatives
HZL has accelerated its sustainability roadmap with:
- Carbon neutrality target by 2050
- Achieved ~50% renewable energy integration at smelter-refinery complexes
- Water positivity projects in Rajasthan mining clusters
- ₹412 crore CSR expenditure in FY25 focusing on education, health, skill development, and women empowerment
Stock Performance: HZL Share Price Trend
| Period | Closing Price (₹) | % Change |
|---|---|---|
| 5 days ago | 368 | +2.7 |
| 1 month ago | 355 | +6.2 |
| 3 months ago | 334 | +12.6 |
| 6 months ago | 298 | +24.8 |
| YTD | 290 | +27.5 |
(Source: NSE data, as of June 30, 2025)
Future Outlook
Short Term
- Stable zinc prices (~USD 2,550 per tonne LME) will support earnings.
- Silver production ramp-up to sustain net profit growth.
Long Term
- Expansion to 1.2 million tonnes capacity by FY27
- Deeper underground mining and advanced beneficiation for cost efficiency
- Higher dividend payouts supported by strong free cash flows
Government Stake Sale Possibility
The Centre has been exploring the sale of its 29.5% residual stake in Hindustan Zinc to raise non-tax revenues. However, market analysts expect:
- Partial stake sale post FY26 to optimise valuation
- Potential resistance from minority shareholders over dilution of strategic interest
Challenges Ahead
| Challenge | Impact |
|---|---|
| Global zinc price volatility | Could pressure realisations and EBITDA margins |
| Mining regulatory risks | Environmental approvals for expansions can face delays |
| High dividend payouts | Limits retained earnings for large M&A-based inorganic expansions |
Conclusion
Hindustan Zinc’s contribution of ₹87,000 crore to the exchequer over five years, with ₹18,963 crore in FY25 alone, reaffirms its pivotal role in India’s mining economy and fiscal health. As the company expands its production base and strengthens its ESG performance, it is well poised to continue delivering strong economic, community, and shareholder value while supporting the nation’s resource security and developmental priorities.
Disclaimer
This article is based on Hindustan Zinc investor disclosures, annual report data, and market analyst insights as of June 30, 2025. Readers are advised to consult certified financial advisors before making investment decisions based on corporate financial data.
