Hind Zinc ups tags by 6%

Hindustan Zinc Ltd raised zinc price by 6 per cent effective from Wednesday, seventh revision this month. With the increase of Rs 10,200, the high grade zinc price would touch Rs 180,300 per tonne, a gain of about 3 per cent from the beginning of this month and above 7 per cent from the start of this calendar year.

The high grade zinc price was ruling at Rs 140,400 per tonne and Rs 107,300 per tonne on April 1 and January 1 respectively.

These prices are exclusive of excise duty and central sales tax of 16 per cent and 1 per cent respectively at ex-factory/stock point basis.

"The zinc producer wants to make as much money as possible and the frequent price revision is a step in that direction. The company does not want to leave an opportunity to move in tandem with the London Metal Exchange (LME)," a local trader said.

Zinc prices on the LME have surged by 80 per cent to trade at a record high of $3420 per tonne for three-month delivery since the beginning of the year.

"Today, bank deposits are being diverted to metal trade which is adding to already bullish sentiment in the market. With a spurt in galvanising steel demand, zinc demand is gallopping leaps and bounds and thereby, strengthening the strong fundamental further," a local trader said.

Till recently, rally above $3,000 was seen but sudden spurt in demand from galvanising steel and toys industry helped boost touch the new high and making room for further growth in the days ahead, the trader added.

The optimists initiated with the buying and the spurt continued throughout controlled by small traders on the LME.

Zinc is analysts' best buys among all metals. This metal is attracting further fund and speculative investment that will continue to drive prices further into uncharted territory, a trader said.

The current spurt in zinc prices is mainly attributed to the 56 per cent production shortfall by Peru's copper-zinc mine Compania Minera Antamina SA. Zinc production at Antamina, where Teck Cominco owns a 22.5 per cent stake, fell to 26,300 metric tonnes of zinc in concentrates due to lower ore grades.