Scribd
Upload
11 views2 pages

Share 1

Hindustan Zinc's stock is crashing due to a large block deal by promoter Vedanta, which sold a 1.6–1.71% stake at a discount, causing a 6–7% intraday drop. Concerns over further promoter selling and technical weaknesses have extended the stock's decline, wiping off ~15% of its value in a week. Despite this, the company's long-term fundamentals remain strong, with significant capital expansion plans and favorable production costs, suggesting potential buying opportunities for investors willing to endure short-term volatility.

Uploaded by

Manoj
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
11 views2 pages

Share 1

Hindustan Zinc's stock is crashing due to a large block deal by promoter Vedanta, which sold a 1.6–1.71% stake at a discount, causing a 6–7% intraday drop. Concerns over further promoter selling and technical weaknesses have extended the stock's decline, wiping off ~15% of its value in a week. Despite this, the company's long-term fundamentals remain strong, with significant capital expansion plans and favorable production costs, suggesting potential buying opportunities for investors willing to endure short-term volatility.

Uploaded by

Manoj
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

Why the stock is crashing

1. Large block deal by promoter Vedanta

• On June 18, 2025, Vedanta offloaded around 1.6–1.71% stake (~66–72 million shares) in
Hindustan Zinc via a block deal valued between ₹3,000–₹3,323 crore
tradingview.com+15outlookmoney.com+15businesstoday.in+15.

• The shares were sold at a discount: floor price ranged between ₹452.5–₹460 compared to
the previous close (~₹486) outlookmoney.com+4businesstoday.in+4niftytrader.in+4.

• This triggered a sharp drop of 6–7% intraday, taking the stock down from ~₹486 to around
₹452–₹456 .

2. Promoter overhang and market sentiment

• The block sale created a supply overhang concern: markets fear Vedanta may continue
selling, weighing on near-term demand
tradingview.com+14m.economictimes.com+14niftytrader.in+14.

• Notably, this drop extended a six-session losing streak, wiping off ~15% of the stock value
within a week niftytrader.in+3m.economictimes.com+3tradingview.com+3.

3. Technical weakness

• Analysts flagged a break below key support zones—₹502 and the 200-day moving average—
raising the possibility of further decline toward ₹450 stocktwits.com.

What’s next?

Medium/long-term fundamentals remain strong:

• Hindustan Zinc recently announced a massive ₹12,000 crore capex to expand zinc smelting
capacity by 250 ktpa in Rajasthan, part of a strategy to double capacity by FY28
m.economictimes.com+8outlookmoney.com+8m.economictimes.com+8.

• Broking houses like JM Financial maintain a Buy rating with targets of ₹550, citing low
production costs and captive power advantages
moneycontrol.com+4businesstoday.in+4m.economictimes.com+4.

• Others like Motilal Oswal call it Neutral, pricing in the positives already, with targets around
₹480 m.economictimes.com.

Watch for:

• Any further promoter selling (which might pressure prices short term).

• Zinc commodity trends and macro factors (which affect margins).

• Whether the ₹12k cr capex execution progresses smoothly.

What should you do?


Time Horizon Strategy

Short-term (days– Be cautious: the stock is facing technical headwinds and potential additional
weeks) supply from promoter sales.

If you're bullish on the expansion and zinc cycle, current levels (₹450–₹460)
Medium to long-
might offer a good entry point, though consider spreading out your purchases
term (6–24 months)
(“phased buying”).

Bottom line

The steep drop to ₹450–₹460 isn’t because of any operational or industry crisis—just promoter
selling leading to technical momentum weakness. The underlying growth story and cost advantage
remain intact, making it a potentially compelling opportunity—if you can ride out the volatility.

Would you like to track technical signals, set alerts around support/resistance levels, or dive deeper
into broker models or capex timelines?

You might also like