Hindustan Zinc shares surged more than 5 per cent in Wednesday’s trade after Jefferies raised its target price, saying the recent divergence in metal prices will have favorable earnings implications on the silver and zinc producer, while weighing on Hindalco Industries.
The stock opened higher at ₹605 and extended gains to hit an intraday high of ₹623.75 on the National Stock Exchange (NSE).
Hindustan Zinc shares have remained largely flat so far in 2026, compared with a 7 per cent decline in the Nifty 50 during the same period. However, over the past year, the stock has surged 44 per cent, sharply outperforming the Nifty’s 1.6 per cent decline.
As of 10:30 AM, Hindustan Zinc shares were trading 4.4 per cent higher at ₹618.75, with nearly 10 million shares changing hands on the NSE.
Jefferies in its latest report, has raised the target price to ₹750 from ₹660 and retained ‘Buy’ rating. The target implies an upside of 26 per cent from the previous close of ₹592.60.
According to Jefferies, favourable zinc and silver prices will provide a boost to the Vedanta Group company’s earnings.
Notably, spot zinc price has gone up by 15 per cent from June quarter levels and have risen 31 per cent since March, driven by declining mine output, operational disruptions and limited project development outside China.
The brokerage expects zinc prices to remain supported by supply constraints and sees further upside.
Likewise, silver prices have recovered 23 per cent from July lows. It expects prices to increase further in a scenario of persistent inflation and stable near-term nominal interest rates.
“JEF global commodities team remains constructive on precious metals, believing that the implications of widening fiscal deficits, elevated debt levels, and ongoing currency debasement remain underappreciated,” the report said.
Jefferies has raised Hindustan Zinc’s FY27-29E EPS by 10-11 per cent factoring in higher zinc & silver prices. Its estimates are now 16-23 per cent above consensus. At spot zinc and silver prices, the FY28 EPS could even see a further potential upgrade of 12 per cent.
Hindustan Zinc’s valuation, at 7.5x 1-year forward EV/Ebitda, is slightly below last 10Y average of 7.8x and is reasonable.
Meanwhile, Jefferies has cut Hindalco Industries’ FY27-29E EPS by 2-3 per cent factoring lower aluminum prices. It has, however, raised Hindalco’s target price to ₹1,140 from ₹1,100 and retained the ‘Hold’ rating.
Overall, Jefferies said that it prefers Hindustan Zinc over Hindalco, citing stronger earnings tailwinds from zinc and silver prices.
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