Hindustan Zinc Limited Company profile

Submitted by:Rahul Chaudhary (609) Saurabh Chaudhary(610) Deepak Dani(665)

Techno India NJR Institute of Technology

Submitted to:Hindustan zinc limited

Mission Statement

Enhance stakeholders value through exploration, innovation, operational excellence and sustainability.

Be a globally lowest cost producer.

Maintain market leadership and customer delight

INTRODUCTION
Hindustan Zinc Limited (HZL) was established in 1966 as a public sector undertalking in april 2002 The core business of the compayis mining andsmelting of zinc and lead along with captive power generation. The Compay is India's largest and world'ssecond largest producer of zinc and lead. HZL has four mines situated in Rajasthan and four smelting operations located in Rajasthan and Andhra Pradesh. Dominant player with backward integration. HZL is India's largest and world's second largest integrated producer of zinc and lead. It has ~6% marketshare in zinc in the global market and ~75% market share in zinc in India HZL exports zinc to Far East, Middle East and the African countries (exports accounted 34% of total revenue in FY10). In FY10, HZL produced 768,620 tonnes of zinc and refined metal production of 650,038 tonnes of lead. It also recorded highest ever production of silver at 176,381 kilograms. HZL fulfills 100% of its power requirement of smelters and mines from its captive power plants (CPP). HZL owns 474 MW of coal based thermal captive power plants in Rajasthan, 123.2 MW of wind energy in Gujarat and Karnataka and also generates 20.2 MW power from the waste heat generated from roasters. The surplus power generated is sold to the state grid. The work at the 100,000 tpa lead smelter is under construction; post completion, HZL Will become the wo rlds largest zinclead producer with a capacity of 1,064,000 tpa. In FY11, it has commissioned 160 MW (80X2) CPP at Dariba smelting complex, increasing the total captive power generation capacity to 474 MW. In FY11, it has also commissioned 1.50 mtpa silverrich Sindesar Khurd Mine concentrator. HZL also plans to increase its silver production from 180 tpa to ~500 tpa.

COMPANY DATA
FULL NAME:HINDUSTAN ZINC LIMITED

ADDRESS CORDINATES:- CRDL Complex

Zinc Smelter Debari Udaipur 313 024 Rajasthan, India

COMMUNICATION POSSIBILITIES AND SKILLS:TEL:- (294) 2420813 2420815 FAX:-0294-2427734 WEBSITE:- www.hzlindia.com NO. OF EMPLOYEE:- 6986 TYPE OF COMPANY:- PRIVATE CONTACT PERSON AND FUNCTION:CSR Contact Person Name of contact person : Designation: Company Name: Contact Address: Email Id 1: CSR Website / Section: Mr. Pavan Kaushik Head (Corporate Communication) Vedanta Group Yashad Bhavan Udaipur 313001 pavan.kaushik@... http://www.hzlindia.com/corp_soc_responsibility.aspx

Bankers
State Bank of Bikaner & Jaipur IDBI Bank Limited ICICI Bank Limited HDFC Bank Limited

Citi Bank Calyon Bank Development Bank of Singapore

QUILITY
HZL believes in sustainable development in harmony with nature and accordingly, is committed to the effective management of health, security and safety of all its employees, protecting its surrounding environment and making a contribution to the development of the local community. This commitment encompasses efficient use of natural resources, protection of assets and provision of a safe workplace with support systems for zero harm to the environment. Accordingly, HZL will strive to:

Maintain management systems for health, safety, security, environment and the community that are in compliance with law and consistent with world-class standards like ISO 14001, OHSAS 18001.

Develop a working culture conducive to continuous improvements in performance without compromising with safety, security and health of its employees and its commitment to develop in harmony with nature.

Develop employees through training and leadership. Conserve natural resources through efficient use. Work with communities to contribute to their development. Institute and update systems to report progress with high standards of reporting integrity.

CAPACITY
We Initiate coverage on Hindustan Zinc Ltd (HZL) with a BUY call recommendation a target price of Rs 151. HZL is a part of Vedanta Resources PLC and is one of the fully integrated zinc and lead mining and smelting company in India. It is Indias largest and worlds second largest integrated zinc producer, producing around 5% of zinc and 3% of lead of the total metal produced across the world. The company is increasing its metal production capacity, consisting of lead smelter with 100ktpa at its Dariba plant followed by Silver, which would help to increase its production capacity to 500tons by FY12. Zinc-Lead capacity supported by Silver to lead the show HZL is increasing its lead smelting capacity at its Dariba plant by 100ktpa, which would help it to become among the worlds largest integrated metal producer. Post expansion, its total metal production would reach to 1064ktpa as against 964ktpa. Apart from this, the company is also increasing its Silver production capacity to 500tons FY12, which would help to make it as worlds 7th largest silver producer. Low cost producer of Zinc Having in-house facility right from mining to smelting the ore, it has led HZL to become among the worlds low cost producer of zinc. Also its Rampura Agucha Mine is considered as one of the most cost-efficient zinc mine in the world, with total reserves of 75.71mnt which can last for next 25-30 years. Thus we assume, being benefited from low cost it would help the company in saving expenses whose impact would be seen in its Operating Margins in long term. Huge Cash Balance to help acquire more metal assets in overseas markets As on March 2010, HZL had a Cash Balance of Rs 9275mn while we assume the same to reach the peak of Rs 160,113mn during FY13. High cash in hand would trigger the company for further acquisition of metal assets in overseas markets. Valuation At CMP of Rs 130, HZL is trading at 9.9x and 8.9x its FY12E and FY13E earnings respectively. On EV/EBIDTA basis, it is trading at 6.2x and 6.0x its FY12E and FY13. We value the stock at 6.0x its EV/EBIDTA and arrive at a Fair Value of Rs

151,which gives a potential upside of 16% over its CMP. Hence we recommend a BUY call on the stock.

EQUIPMENTS
1.Waste Heat Boiler System, turbo Generator 2.Hot Gas Precipitator, Wet Gas Precipitator 3.Calcine Drum Coolers, Ball mill, Slinger feeder Machine, Catalyst 4.Agitators, Paddle Mixers, Thickener Rake Mechanism 5.Horizontal Belt Filters, Filter Presses 6.Cooling Towers, Heat Exchangers, 7.Copper Bus-Bar, Insulators, Acid Proof Rubber Lining 8.Transformer Rectifier System 9.Cell House Cranes, Anode Cleaning and Straightening Machines, Cathode Stripping Machine 10.Aluminium Cathodes, Lead Anodes 11.Electrolytic Concrete Cells, Cell Liners for Cell House 12.Induction Melting Furnace, Casting Machines, Molten Metal Pumps

13.Zinc Ingot Strapping and Wire Housing System

(ORGANISATION) STRUCTURE

Our people :-

Board of Directors Mr. Agnivesh Agarwal - Chairman Mr. Navin Agarwal - Director Mr. A. R. Narayanaswamy - Director Ms. Anjali Anand Srivastava - Director Mr. R. K. Malhotra - Director Mr. Akhilesh Joshi - COO & Whole-time Director Chief Financial Officer Mr. S. L. Bajaj Company Secretary Mr. Rajendra Pandwal Registered Office Yashad Bhawan Statutory Auditors M/s. Deloitte Haskins & Sells Chartered Accountants 12, Dr. Annie Besant Road

Dedication :-

The investment that a Company makes in its people is one of the most important investments it can ever make. I am perennially amazed and impressed with the competency, dedication, integrity and enthusiasm of our employees at every level of the Company. We have undergone a phenomenal transformation at the back of competency and improvement oriented work culture of our people,supported by a string of debottlenecking and expansions. Our people continue to play a vital role in helping the organization to create value and to grow with confidence. We believe in recruiting truly

outstanding people, providing them with quality assignments, training, support and international opportunities in orderto help them flourish both professionally and personally. I would like to thank all our employees for their continued contribution to the growth, success and sustainability of the Company.

Training :-

---Imparted training to 311 SHG members in different traits. Through Income Generation
trainings, more than 50% of the SHG women are linked with micro enterprise with additional monthly incomes up to 4,000/----Imparted training to 763 rural youth. More than 70% trained youth are self-employed with monthly income of 4,000/- to ` 8,000/----A specialised training programme has been undertaken with an objective to build the capacity of grassroots level functionaries. The trainings were imparted in two batches covering all the 36 coordinators of Rampura Agucha, Rajpura Dariba, Debari. ----The project will be implemented in all operational villages, ensuring 100% cattle vaccination and farmers trainings for improved agricultural practices.

Sales policy :-

Zinc metal sales in the domestic market during the year were 411,617 tonnes, while export sales accounted for 300,986 tonnes. Lead metal sales in the domestic market during the year were 57,204 tonnes, with the export sales accounting for 25 tonnes. Sales during the year were augmented by sale of 65,957 Dry Metric Tonnes (DMT) of surplus Zinc concentrate and 38,457 DMT of surplus Lead

INFRASTRUCTURE (WORKING ENVIRONMENT)

We are one of the lowest cost producers in the world and are well placed to serve the growing demand of Asian countries. Hindustan Zinc is a subsidiary of the NYSE listed Sterlite Industries (India) Limited (NYSE: SLT) and London listed FTSE 100 diversified metals and mining major Vedanta Resources plc.

Smelting operations
Production in FY 2011: 84,839 tonnes of Zinc Capacity: 88,000 tonnes of Zinc

Power operations
Type: DG Set Capacity: 14.81 MW Type: Waste Heat Recovery Capacity: 6.5 M

FINANCES (STATEMENT)
In 200910,the domestic copper production was estimated at around 814,964 tonnes, while consumption was estimated at 636,000 tonnes. India exports around 37% of the copper produced and imports 19.5% of the copper consumption.Domestic copper prices are usually aligned with the cash prices on the London Metal Exchange (LME). Thus, the global demandsupply scenario primarily governs copper prices. .

REFERENCES (CLIENTELE)
www.hzlindia.com www.google.com