Hindustan Zinc could be re-rated amid silver price surge

With silver prices surging on the back of strong demand, Hindustan Zinc may get re-rated as it is one of the largest producers of the precious metal.

Silver prices recently surged past $50 per ounce, reaching multi-year highs. This, coupled with favourable momentum across zinc and lead, have contributed to the positive outlook on Hindustan Zinc.

According to a recent Batlivala & Karani Securities report, the stock “merits a potential re-rating toward 12–14 times EV (Enterprise value) /EBITDA.”

According to the report, Hindustan Zinc “remains one of the world’s lowest-cost and most efficient producers of zinc, lead and silver,” supported by sizeable internal accruals and minimal leverage.

The brokerage noted that “trading at 8.8 times EV/EBITDA, the stock appears undervalued relative