Hindustan Zinc Hits 18-Year High Return on Capital to Fuel Massive ₹50,000 Crore Expansion Drive
New Delhi, June 5, 2026: Hindustan Zinc Limited has delivered a remarkable return on capital employed (ROCE) of approximately 67% for the 2026 fiscal year, marking its highest capital efficiency in 18 years. According to insights from the company’s newly released FY26 Annual Report, this robust financial performance and disciplined capital allocation have laid a formidable foundation for its next strategic growth phase. The company managed to generate an impressive ₹13,337 crore in free cash flow from operations during the year, highlighting its exceptional ability to convert earnings into liquid cash while retaining the financial agility needed for heavy future investments.
A massive surge in value creation metrics further underscored the mining giant’s fiscal health during this period. Economic Value Added (EVA), which measures actual wealth created after accounting for the total cost of capital, skyrocketed by 138% to reach ₹11,643 crore in FY26, up from ₹4,900 crore in FY25. This brought the EVA as a percentage of average capital employed to 73.9%, proving that Hindustan Zinc is generating returns well above its baseline cost of capital. A primary driver behind this success was an aggressive focus on cost leadership; the production cost of zinc (excluding royalty) dropped by 9% year-on-year to a five-year low of US$959 per tonne, anchoring the firm among the lowest-cost zinc producers on the planet. To insulate itself from global energy volatility, the company also successfully boosted its domestic coal mix and expanded its renewable energy sourcing.
This stellar operational performance arrives at a crucial time of global market volatility, economic uncertainty, and shifting trade dynamics. Looking ahead, the Annual Report details the company’s ambitious “HZL 2.0” strategy, which outlines a massive growth capex programme of ₹40,000–50,000 crore over the next five years. This capital injection is designed to nearly double the company’s refined metal capacity to 2.0 million tonnes per annum (Mtpa). Concurrently, the firm is expanding into critical minerals and future-facing sectors that align with India’s broader infrastructure and green energy transition goals. A core pillar of this long-term strategy involves expanding resources, with an targets to aggressively scale up metal reserves from 13 Mnt to 50 Mnt, ensuring a mine life exceeding 25 years. Hindustan Zinc has already taken major steps toward this goal by securing critical mineral blocks in rare earth elements, tungsten, and potash.
Commenting on the company’s performance and long-term strategy in the FY26 Annual Report, Priya Agarwal Hebbar, Chairperson, Hindustan Zinc Limited, said: “The world is going through a generational inflection point, one where minerals and metals have moved to the centre of global geopolitics and geoeconomics, much as oil once did. Mineral security is now national security. India is actively pursuing self-sufficiency in critical minerals, and Hindustan Zinc is ready to help lead that journey – expanding well beyond our zinc-silver legacy into a broader, strategically relevant multi-metal portfolio.”
She added, “At Hindustan Zinc, we have always tried to stay ahead of the curve on growth opportunities and at the bottom of the curve on costs. That is the best way to future-proof the company and be ready to perform at our best irrespective of external circumstances. Our Board has approved our most ambitious capex programme, aimed at doubling the refined metal capacity to 2.0 Mtpa, which will almost double the annual revenue and EBITDA.”
Backing up these ambitious forward-looking statements are the record-shattering numbers from the past fiscal year. The annual report confirms that Hindustan Zinc achieved a historic revenue of ₹40,844 crore and an EBITDA of ₹22,162 crore during FY26, maintaining a highly lucrative EBITDA margin of roughly 54%. Operationally, the company also hit its highest-ever mined metal production at 1,114 kt, demonstrating sustained execution across its various mining and smelting facilities. As global investors place greater scrutiny on cash flows and capital discipline over basic earnings growth, Hindustan Zinc’s FY26 results serve as a prime industry example of converting raw operational efficiency into sustainable, long-term corporate value.
