Hindustan Zinc plans capacity expansion

Mumbai: Hindustan Zinc, a Vedanta Group company, will invest Rs 3,600 crore to expand capacity to 1.65 million tonnes an annum (mtpa) from 7.54 lakh tpa.

Mr Kuldip Kaura, Chief Executive Officer, said Hindustan Zinc would become number one on completion of the expansion plan in two years. The expansion project will be funded through internal accruals as the company is debt free, he added.

The project includes setting up of a 210,000 tpa zinc smelter, 100,000 tpa lead smelter and 160 MW of captive power plants with fully-integrated mining capacities. The company has total reserves and resources of 232.3 million tonnes (mt) containing 27.5 mt of zinc and lead. A total of 68.8 MW of wind power capacity was commissioned, taking the installed wind energy capacity to 123.2 MW.

The company has commissioned a 1.70 lakh tonnes an annum Chanderiya Hydro II zinc smelter at Chanderiya three months ahead of schedule. In April, the company completed 88,000 tonne zinc de-bottlenecking project at Chanderiya and Debari.

The board has recommended a final dividend of Rs 2.5 a share. The company earlier paid an interim dividend of Rs 2.5.

Zinc prices have seen a sharp fall in London Metal Exchange in last couple of months after touching a historical high in 2006-07. However, the long-term price projections continue to be healthy on the back of growing demand. The company would focus on cost of production and volumes to protect the profit margin, he said.