Mining giant Hindustan Zinc (HZL) has declared an interim dividend of Rs 10 per equity share for the financial year 2024-25, even as its fourth-quarter financial results for FY24 revealed a significant dip in net profit. The company's board set May 15, 2024, as the record date for determining eligible shareholders for the dividend payout.
Q4 FY24 Performance Overview
For the quarter ending March 31, 2024, Hindustan Zinc reported a consolidated net profit of Rs 2,038 crore, marking a 21% decrease compared to the Rs 2,583 crore recorded in the same period last year. Revenue from operations also saw a decline, dropping by 12% year-on-year to Rs 7,285 crore from Rs 8,281 crore in Q4 FY23.
Despite the profit and revenue declines, the company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for Q4 FY24 stood at Rs 3,646 crore, a 15% reduction from Rs 4,285 crore in the prior year. On the operational front, Hindustan Zinc reported a 1% year-on-year increase in mined metal production, reaching 299 kilotonnes, while refined metal production grew by 6% to 270 kilotonnes.
Interim Dividend Details
The interim dividend of Rs 10 per share translates to a total payout of Rs 4,225 crore for the company. This marks the first dividend announcement for the new financial year. Historically, Hindustan Zinc has been a consistent dividend payer, often distributing significant portions of its earnings to shareholders.
Analyst Outlook and Share Price Targets
Following the results and dividend announcement, several brokerage firms have updated their outlook on Hindustan Zinc. The general sentiment among analysts remains cautious, largely due to concerns over valuation and the outlook for commodity prices.
- Motilal Oswal: Maintained a 'Neutral' rating with a target price of Rs 310 per share.
- Nuvama Institutional Equities: Issued a 'Reduce' rating, setting a target price of Rs 328.
- ICICI Securities: Recommended a 'Reduce' rating with a target price of Rs 340, citing higher valuation and potential headwinds from declining zinc prices.
The company's shares have seen considerable movement recently, with a notable rally in the past six months. Investors will be closely watching commodity markets and future operational guidance from Hindustan Zinc as they assess the company's long-term prospects.