Hindustan Zinc's margin expands as revenue growth outpaces costs
Lower interest and wider operating margins lifted consolidated net profit by +142.05% YoY, while other income remained a limited profit contributor.
Filed 19 Oct 2026, 15:33 IST · after market close · Hindustan Zinc Ltd (HINDZINC)
Key takeaways
- Consolidated revenue rose +76.55% YoY, while expenses grew +42.42%, lifting operating profit +108.05%.
- Operating margin expanded 2.71 percentage points QoQ to 61.27% as revenue growth outpaced expense growth.
- Net profit increased +142.05% YoY to Rs 6,412 cr, with other income contributing 4.36% of pre-tax profit.
Price around the results
Revenue growth lifts Q2FY27 earnings
Hindustan Zinc reported consolidated revenue growth of +76.55% YoY in Q2FY27, against expense growth of +42.42%, which lifted operating profit by +108.05%. Sequentially, revenue rose +9.79% while expenses increased only +2.60%, taking net profit up +17.24% QoQ. This was the company's second consecutive quarter of double-digit sequential net-profit growth.
Lower costs and interest support margin expansion
Operating margin expanded 2.71 percentage points QoQ and 9.28 percentage points YoY because revenue grew faster than expenses in both comparisons. Interest expense fell 33.33% QoQ and 66.02% YoY, adding support below operating profit. The tax rate changed by only -0.03 percentage points QoQ, while other income was 4.36% of pre-tax profit, so neither tax nor non-operating income was a major source of the earnings increase.
Margin has risen for five straight quarters
Operating margin has increased from 49.66% in Q1FY26 to 61.27% in Q2FY27, marking five consecutive quarterly expansions. Hindustan Zinc's margin was 42.65 percentage points above the 18.62% median for the seven Commodities peers that had reported the same quarter.
Management flags technology, silver supply and power targets
Management said it is using tele-remote operations and 3D tracking at its mines, while declining grades and mining challenges were constraining silver supply. The company said it has approximately 74% of India's primary zinc market and expects zinc demand to grow at a 1.4% CAGR over the next decade. Management also stated targets of 70% renewable power by FY28 and net zero by 2050 or earlier.
No post-results move yet; recent reactions have been mixed
The results were filed after market close, so the stock's current post-results reaction is not covered. Across eight recent result reactions, the stock rose four times and fell four times, with a median absolute move of 1.18%.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹15,093 cr | ₹13,747 cr | +9.79% | +76.55% |
| Other income | ₹374 cr | ₹316 cr | +18.35% | +57.14% |
| Expenses | ₹5,845 cr | ₹5,697 cr | +2.60% | +42.42% |
| Operating profit | ₹9,248 cr | ₹8,050 cr | +14.88% | +108.05% |
| Operating margin (%) | 61.27% | 58.56% | — | — |
| Interest | ₹88 cr | ₹132 cr | -33.33% | -66.02% |
| Depreciation | ₹962 cr | ₹920 cr | +4.57% | +9.07% |
| Profit before tax | ₹8,572 cr | ₹7,314 cr | +17.20% | +142.01% |
| Tax | ₹2,160 cr | ₹1,845 cr | +17.07% | +141.88% |
| Net profit | ₹6,412 cr | ₹5,469 cr | +17.24% | +142.05% |
| EPS (₹) | ₹15.18 | ₹12.94 | +17.31% | +142.11% |
Operating margin of 61.27% compares with a Commodities sector median of 18.62% across 7 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- Zinc demand is expected to grow at a 1.4% CAGR over the next decade.
- The company targets 70% renewable power by FY28.
- The company targets net zero by 2050 or earlier.
New initiatives
- The company is using tele-remote operation and 3D tracking at its mines.
Competition
- The company reports approximately 74% primary zinc market share in India.
Problems & risks
- Declining grades and mining challenges are constraining silver supply.
What to watch
- Whether operating margin holds above 61.27% after five consecutive quarterly increases.
- Whether expenses continue to grow slower than revenue, after +2.60% QoQ versus +9.79%.
- Progress against management's target of 70% renewable power by FY28.