Vedanta group firm Hindustan Zinc Limited (HZL), the country’s only integrated producer of zinc-lead and silver, is being optimistic about the outlook for the next quarter, despite the growing talk about the possibility of major world economies slipping into a recession in the near future, CEO Arun Misra said on Saturday.
“I am very hopeful that the US economy will drive demand in a big way, even though Europe will be slightly sluggish,” said Misra, adding that the American government’s decision to hugely spend on infrastructure will be a big driving force for global demand.
Additionally, emerging economies would continue their capex spending and this would also sustain demand, he said.
Commenting on the performance, Misra said, “With last 12 months’ run-rate for both mined and refined metal comfortably sustaining above one million tonne, we are fully geared to deliver another stellar performance this year.”
“We would like to reiterate our guidance on volume and capex for Fy23,” he said.
The CEO said the company has drawn up capex plan of Rs 2,500 crore over the next 18 months. “We would be spending the amount on setting up a fertilizer plant and a separate roaster at a smelting unit,” he said. The fertilizer plant may come up at Chanderia in Rajasthan.
Elaborating on the company’s commitment to net zero by 2050, he said the company has signed a power delivery agreement for sourcing up to 200 MW renewable energy, which will avoid 1.2 million MT of carbon emission.
In another step towards decarbonising operations, Misra said the company plans to replace all its 900 diesel-run mine vehicles, in all its eight mines spread across five districts in Rajasthan, with battery vehicles, entailing an expenditure of $1 billion over the next five years. “We are making a beginning with the introduction of four battery vans,” he said.
The company reported a nearly 44% rise in consolidated net profit at Rs 5,722 crore for H1FY23 on the back of factors like higher zinc volumes. It had posted a consolidated net profit of Rs 4,000 crore in the year-ago period.
Meanwhile, its consolidated revenue from operations in H1 increased to Rs 17,723 crore, over Rs 12,653 crore in the year-ago period.
Overall the company’s H1FY23 mined metal production was 507 kt, an increase of 8% yoy, in line with improved smelter performance, better mined metal flow from mines and better plant availability partly offset by acid storage tank breakdown at Chanderia plant in Q2 FY23.
(The writer was in Udaipur on the invitation of Hindustan Zinc Limited)