Vedanta shares rise over 5% on Hindustan Zinc's dividend shot
Post its September quarter results, Hindustan Zinc declared interim dividend of ₹21.30, amounting to ₹9000 crore. Major part of the dividend will go to Vedanta which holds 64.92% in the company
MUMBAI: Shares of Vedanta gained as much as 5.2% on Wednesday as investors cheered dividend payout of ₹21.30 per share by its subsidiary Hindustan Zinc.
At 10:50 am, shares of Vedanta were 4% higher at ₹102.75. On the other hand, Hindustan Zinc stock was 3% higher at ₹229.60, while the benchmark index, Sensex gained 0.87% to 40898.
Post its September quarter results, Hindustan Zinc declared interim dividend of ₹21.30 , amounting to ₹9000 crore. Major part of the dividend will go to Vedanta Limited which holds 64.92% in the company.
Latest shareholding data showed that billionaire Anil Agarwal-led Vedanta held 274.31 crore shares, or 64.92%, stake in the company as of 30 September which amounts to ₹5,843 crore.
Earlier this month, Vedanta's delisting failed as per terms of delisting regulations. The promoters had sought to buy out 169.73 crore shares or 47.67% stake held by the public to delist the firm.
Since the beginning of the year, Vedanta shares have declined 33% against a fall of 0.86% in the Sensex. Hindustan Zinc gained 9%.
Hindustan Zinc’s revenue increased 25% year-on-year to ₹5660 crore in September quarter primarily due to higher silver volumes coupled with higher silver prices. Its EBITDA grew 39% YoY to ₹2950 crore on strong revenue growth as well as lower cost.
The management of Hindustan Zinc said that zinc demand in India has recovered to pre-covid levels and global demand is also recovering gradually, led by China. However, it expects global zinc demand to contract by 5–6% in 2020.
“We expect EBITDA for HZL to grow at a 20% CAGR over FY20–22, primarily owing to a 9% CAGR in refined metal volumes to 1,034kt and higher silver prices," said Motilal Oswal Financial Services in a note.
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