Hindustan Zinc extended its up-move into a fourth session, with the stock trading around Rs 550-551 on the BSE, up about 5.3 % over the previous close of Rs 522.45. Intraday it has tested Rs 553.40, effectively a fresh 52-week high, taking the rally to a little over 10 % in three trading days.

Volumes at nearly 9 lakh shares are roughly double the recent two-week average, and at these levels the company commands a market capitalisation of about Rs 2.3 lakh crore, valuing it at roughly 21 - 22x trailing earnings,  a premium to its 5-year average P/E of around 15x.

The immediate trigger is the explosive move in silver. MCX March 2026 futures have repeatedly printed record highs near the Rs 1.9-2.0 lakh per kg mark over the past week, extending an 80 to 90 % year-to-date rally driven by a weaker dollar, expectations of further US rate cuts and strong industrial demand from solar, EVs and electronics.

Hindustan Zinc is among the world’s top five silver producers and India’s only integrated listed silver play; silver has contributed roughly 41 % of profits in recent quarters, giving the stock very high earnings leverage to the metal’s price.

The highlight is that management plans to lift refined silver capacity from about 800 tonnes per annum to 1,500 tpa via debottlenecking and new units such as the Chanderiya fumer and HAL plant, effectively doubling potential output into what many expect to be a structural global silver deficit.

Operationally, the company was already on firmer footing before this latest bullion spike. Q2 FY26 results showed net profit up about 14 % year-on-year to Rs 2,649 crore on revenue growth of 4 %, with EBITDA margins around 45–50 % supported by low unit costs and higher realisations in both zinc and silver.

Over FY25–26 Hindustan Zinc has consistently reported industry-leading margins and strong cash generation, while using its “HZL 2.0” strategy to expand into a broader multi-metal and critical-minerals portfolio, even as silver production has grown roughly 20-fold since the early 2000s.

From a market perspective, the current spike reflects investors paying up for that silver optionality: the stock now trades not only near all-time price highs but also at a valuation above its own historical range and at a hefty premium to many global base-metal peers. While elevated silver prices and the planned capacity expansion could continue to push earnings higher if the metal stays tight, risks remain in the form of commodity price reversals, the inherent cyclicality of zinc and lead, and periodic promoter stake sales such as Vedanta’s Rs 3,000-crore block deal in June that briefly knocked the stock 6 % lower. In short, Hindustan Zinc is now being treated by the market as one of the cleanest proxies on the silver super-cycle, but with pricing that already discounts a fair amount of that optimism.