Hindustan Zinc Shares Plunge 7% After Vedanta Sells Rs 3,323 Crore Stake via Block Deal

Vedanta Stake Sale | Hindustan Zinc Stock Crash | Rs 12,000 Crore Expansion | Block Deal Activity | Market Volatility

Shares of Hindustan Zinc Ltd plummeted 7 percent to Rs 452.5 in early trade on June 18 following news that Vedanta Ltd offloaded a 1.71 percent stake—amounting to 7.2 crore shares—in a large block deal valued at approximately Rs 3,323 crore. The transaction, facilitated by DAM Capital Advisors and Citi, marks a significant secondary market selloff, exerting sharp downward pressure on the stock. The floor price was fixed at Rs 460.5, representing a 5.25 percent discount to Hindustan Zinc’s previous close of Rs 485.95 on the NSE.

Highlights

• Hindustan Zinc shares fell 7% after Vedanta sold 1.71% stake.

• Block deal size pegged at Rs 3,323 crore, floor price at Rs 460.5.

• Five-day losing streak continues; stock down 9% in one week.

• Vedanta held 63.42% in Hindustan Zinc as of Dec 2024.

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Vedanta’s Rs 3,323 Cr Block Deal Triggers Sell-Off in Hindustan Zinc

The market responded swiftly to Vedanta’s partial divestment, with shares of Hindustan Zinc hitting an intraday low of Rs 452.5 in the opening minutes of trade. Vedanta—promoter of Hindustan Zinc—has been gradually monetising its stake as part of its broader strategy to raise funds amid balance sheet constraints and upcoming debt obligations. According to BSE data, Vedanta held a 63.42 percent stake in Hindustan Zinc as of December 31, 2024. The deal reflects not only a significant promoter-level transaction but also highlights continued market concern over overhang risk in metal and mining counters.

Highlights

• Block deal raised Rs 3,323 crore through 7.2 crore shares sold.

• Vedanta monetising stake amid group-level debt repayment plans.

• Deal executed at a discount of over 5% from market price.

• Strategic funds raise ahead of upcoming Vedanta bond maturities.

Stock Slides Despite Rs 12,000 Crore Expansion in Rajasthan

The sharp correction in Hindustan Zinc’s stock comes just days after the company announced a massive Rs 12,000 crore expansion plan in Rajasthan. The proposed project includes a 250 ktpa zinc smelter at Debari and mining capacity upgrades to meet future zinc demand. While long-term fundamentals remain strong, the immediate market reaction has been muted, indicating investor focus is still centered on liquidity movements, stake sale pressure, and dilution risks.

Highlights

• Major zinc complex coming up in Debari with 250 ktpa capacity.

• Capex aimed at meeting domestic and global zinc demand growth.

• Project timeline of 36 months, aligned with multi-year outlook.

• Investor sentiment dampened by near-term supply overhang.

Stock Performance: Hindustan Zinc Drops for 6th Straight Session

Hindustan Zinc shares have declined for six consecutive trading sessions, cumulatively falling over 9 percent in the past week alone. The latest stake sale extended the correction from Tuesday’s 5 percent intraday fall, with trading volumes spiking as market participants exited positions fearing further price erosion. At 9:20 am, the stock was seen trading at Rs 457, down 6 percent, while Vedanta shares were up 1 percent at Rs 464, reflecting divergent investor reactions to the deal.

Highlights

• Hindustan Zinc stock has dropped over 8% in five sessions.

• Selling pressure persists post-expansion announcement.

• Vedanta shares trade higher, benefiting from cash inflow.

• Increased trade volume signals institutional activity.

Institutional Interest and Broader Implications

The transaction, executed via block deal, indicates institutional buyers may have absorbed the stake, potentially cushioning the downside in the medium term. However, analysts warn that repeated offloading by promoters and ongoing global metal demand uncertainties could cap near-term upside. With zinc prices showing mixed signals and regulatory overhangs still lingering, Hindustan Zinc’s stock may remain volatile.

Highlights

• Block buyers possibly institutional, absorbing promoter stake.

• Repeated stake sales could continue to weigh on investor sentiment.

• Zinc price volatility and macro risks remain key triggers.

• Stock outlook dependent on capex execution and metal cycles.