Refer to important disclosures at the end of this report ...vid.investmentguruindia.com/report/2020/May/Hindustan Zinc Q4FY2… · Hindustan Zinc (LHS) Rel to Nifty (RHS) What did

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CMP: Rs 169 as of (May 22, 2020)

TP: Rs 187 (■) 12 months

Rating: HOLD (■) Upside: 10.5 %

India Equity Research | Metals & Mining

May 22, 2020

Result Update

Hindustan Zinc Refer to important disclosures at the end of this report

Difficult times ahead; Covid-19 fears outweigh strong dividend yield

Change in Estimates

EPS Chg FY21E/FY22E (%) -36/-26

Target Price change (%) -15%

Target Period (Months) 12

Previous Reco HOLD

Emkay vs Consensus

EPS Estimates

FY21E FY22E

Emkay 11.9 15.4

Consensus 15.5 18.0

Mean Consensus TP (12M) Rs 194

Stock Details

Bloomberg Code HZ IN

Face Value (Rs) 2

Shares outstanding (mn) 4,225

52 Week H/L 265 / 116

M Cap (Rs bn/USD bn) 715 / 9.46

Daily Avg Volume (nos.) 8,69,647

Daily Avg Turnover (US$ mn) 1.9

Shareholding Pattern Mar '20

Promoters 64.9%

FIIs 1.0%

DIIs 2.7%

Public and Others 31.4%

Price Performance

(%) 1M 3M 6M 12M

Absolute 1 (7) (21) (34)

Rel. to Nifty (1) 23 4 (15)

The company posted strong results but uncertain outlook guided management’s decision

to defer FY21 guidance by one quarter. Even though utilization level is 80% currently,

uncertainty due to Covid-19 has dented outlook in an otherwise strong quarter despite 10

days of shutdown.

Projects continued to be delayed as international travel ban interrupted movement of

specialists required for commissioning the projects. A 3-month delay with low capacity

utilization overall in Q1FY21 is likely to result in 9% decline in metal production in FY21.

We cut FY21/22 metal sales volume by 13%/4% and silver sales volume by 18%/13%. We

also cut Zinc LME price assumptions by 21%/20% and Lead LME by 30%/29% for FY21/22

as major economies struggle to boost demand.

Strong dividend yield expectation of c.9% for FY21/FY22 is the silver lining, in our view.

We maintain Hold rating but revise down FY21/22 EBITDA by 37%/26%, roll forward

valuation from Sep-21E to Mar-22E and reduce TP from Rs 200 to Rs187 with OW in EAP

due to dividend yield.

Relative price chart

Source: Bloomberg This report is solely produced by Emkay Global. The following person(s) are responsible for the production of the recommendation:

Vishal Chandak

[email protected]

+91 22 6612 1275

-40

-32

-24

-16

-8

0

100

135

170

205

240

275

May-19 Jul-19 Sep-19Nov-19 Jan-20 Mar-20May-20

%Rs

Hindustan Zinc (LHS) Rel to Nifty (RHS)

What did we like?

Strong operating performance despite shutdown in the last 10 days resulted in sharp

outperformance vs. our expectations. We note that management changed its strategy of

market mix from 70% domestic in pre-Covid times to 70% in exports currently to ensure the

company is able to sell its output despite its major domestic market not available due to

lockdown.

What we did not like?

We believe continued delay in the commissioning the projects is likely to result in a yoy decline

of about 9% in total mined metal production. The decline is also a result of 8 days of shutdown

in April, and lower utilization levels in April and May compared with the historical standards of

the company.

Outlook and valuations

We believe the fortunes of the commodities are strongly tied up to the opening up of

economies while containing the pandemic at the same time. With no clear signs of a cure and

looming threat of second wave on one hand, with strong dividend yield at CMP on other hand,

we maintain Hold with revised TP of Rs187 based on 6x Sep-22E EV/EBITDA. Key risks to

our call are: 1) recovery in global economies driving demand for zinc and hence upswing in

zinc prices; and 2) second wave of pandemic as economies open up, resulting in severe

economic downturn resulting in depressed LME prices.

Please see our sector model portfolio (Emkay Alpha Portfolio): Metals & Mining (Page 10)

Financial Snapshot (Standalone)

(Rs mn) FY19 FY20 FY21E FY22E FY23E

Revenue 2,11,180 1,85,610 1,55,370 2,06,240 2,45,819

EBITDA 1,06,700 88,470 73,914 96,028 1,13,191

EBITDA Margin (%) 50.5 47.7 47.6 46.6 46.0

APAT 79,560 68,050 50,230 65,054 77,263

EPS (Rs) 18.8 16.1 11.9 15.4 18.3

EPS (% chg) (12.0) (14.5) (26.2) 29.5 18.8

ROE (%) 22.9 18.4 12.8 16.9 19.7

P/E (x) 9.0 10.5 14.2 11.0 9.3

EV/EBITDA (x) 5.0 5.7 6.9 5.3 4.2

P/BV (x) 2.1 1.8 1.9 1.9 1.8

Source: Company, Emkay Research

http://www.emkayglobal.com/

Hindustan Zinc (HZ IN) India Equity Research | Result Update


May 22, 2020 | 2

Story in Charts

Exhibit 1: Mined Metal Production (kT)


Exhibit 2: Sales volumes mix


Exhibit 3: Dividend per Share (Rs)


Exhibit 4: Cash & Cash Equivalents per Share (Rs)


Exhibit 5: Zinc Inventory at multi-year low


Exhibit 6: Lead inventory and LME prices


Exhibit 7: HZL 1yr fwd P/B Ratio (x)


Exhibit 8: HZL 1yr fwd EV/EBITDA (x)


904811

960894 917

787

10351156

0

400

800

1200

1600

FY

16

FY

17

FY

18

FY

19

FY

20

FY

21E

FY

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FY

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211

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162 187

177

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36 4

7

34 40 45 5

0

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247 264

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245 260

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41

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Q3F

Y17

Q4F

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Y20

Zinc kt Lead kt Total Sales Vol kt

28 29

8

20

0

17 15 15

0

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40

FY

16

FY

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FY

18

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FY

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DPS

8376

5346

53 51 5159

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1,500

2,500

3,500

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5,500

May' 9

0

Ma

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May' 9

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Ma

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Ma

y' 0

0

Ma

y' 0

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Ma

y' 0

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Ma

y' 1

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Ma

y' 1

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Ma

y' 1

6

Ma

y' 1

8

Ma

y' 2

0

Zinc Inventory (kt, LHS) Zinc (US$/t, RHS)

555105155205255305355

300 800

1,300 1,800 2,300 2,800 3,300 3,800 4,300

Ma

y' 8

8

Ma

y' 9

0

Ma

y' 9

2

May' 9

4

Ma

y' 9

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y' 9

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Ma

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y' 1

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Ma

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8

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y' 2

0

Lead Inventory (kt, LHS) Lead (US$/t, RHS)

0

1

2

3

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5

Ma

y-0

6

Ma

y-0

7

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y-0

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0 0

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8

Ma

y-1

9

Ma

y-2

0




May 22, 2020 | 3

Exhibit 9: Actual vs. Estimates (FY20)

Rs mn Estimates Variation

Actual Emkay Consensus Emkay Consensus

Total Revenue 185,610 193,897 188,956 -4% -2%

EBITDA 88,470 94,288 90,527 -6% -2%

EBITDA Margin (%) 48% 49% 48%

Emkay Net Profit 67,050 63,269 68,701 6% -2%

Source: Emkay Research, Bloomberg, Company

Exhibit 10: Quarterly Financials

Rs mn Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY (%) QoQ (%) FY20 FY19 YoY (%)

Net sales 53,840 49,240 44610 46260 43210 -20% -7%

Other Op Income 1070 630 500 460 700 -35% 52%

Total Revenue 54,910 49,870 45,110 46,720 43,910 -20% -6% 1,85,610 2,11,180 -12%

Inventory Changes 250 -60 -140 -1,710 -1,000 -500% -42% -2,910 -640 355%

Employee Expense 2,130 1,820 1,920 2,010 1,140 -46% -43% 6,890 9,050 -24%

Power and Fuel 3,870 4,450 4,130 4,040 4,420 14% 9% 17,040 17,580 -3%

Mining Royalty 6,990 5,940 5,390 6,130 6,070 -13% -1% 23,530 26,280 -10%

Other Expenses 13,780 12,950 12,640 13,360 13,640 -1% 2% 52,590 25,386 107%

EBITDA 27,890 24,770 21,170 22,890 19,640 -30% -14% 88,470 1,06,700 -17%

Depreciation 5,530 5,340 5,950 5,970 5,530 0% -7% 22,790 18,830 21%

EBIT 22,360 19,430 15,220 16,920 14,110 -37% -17% 65,680 87,870 -25%

Other Income 5,390 4,290 5,900 4,450 4,700 -13% 6% 19,340 17,820 9%

Interest 510 290 250 420 160 -69% -62% 1120 1130 -1%

PBT 27,240 23,430 20,870 20,950 18,650 -32% -11% 83,900 1,04,560 -20%

Total Tax 7,120 5,780 60 4,750 5,260 -26% 11% 15,850 25,000 -37%

Current Tax 5,830 5,000 2,590 3,580 3,110 -47% -13% 14,280 22,200 -36%

Deferred Tax 1,290 780 -2,530 1,170 2,150 67% 84% 1570 2800 -44%

Reported PAT 20,120 17,650 20,810 16,200 12,940 -36% -20% 67050 78620 -15%

Reported EPS 4.76 4.18 4.93 3.83 3.17 -33% -17% 16.1 18.8 -14%


Exhibit 11: Key Margins

Margins (%) Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY QoQ FY20 FY19 YoY

EBIDTA 50.79 49.67 46.93 48.99 44.73 -606 bps -427 bps 47.66 50.53 -286 bps

EBIT 40.72 38.96 33.74 36.22 32.13 -859 bps -408 bps 35.39 41.61 -622 bps

EBT 49.61 46.98 46.26 44.84 42.47 -714 bps -237 bps 45.20 49.51 -431 bps

PAT 36.64 35.39 46.13 34.67 30.49 -615 bps -418 bps 36.66 37.67 -101 bps

Effective Tax rate 26.14 24.67 0.29 22.67 28.20 207 bps 553 bps 18.89 23.91 -502 bps


Exhibit 12: Key Operating and Financial Metrics




May 22, 2020 | 4

Production Voume (kt) Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY (%) QoQ (%) FY20 FY19 YoY (%)

Mined metal content 245 219 210 219 197 -20% -10% 869.8 876 -0.7%

Refined Zinc 175 172 166 178 172.4 -1% -3% 688.4 664 3.7%

Refined Lead 53 48 44 41 49.4 -7% 20% 179.8 176 2.2%

Saleable Silver 191 159 134 149 168 -12% 13% 610 679 -10.2%

Sales Volume (kt) Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY (%) QoQ (%) FY20 FY19 YoY (%)

Zinc Sales Volume 177 168 168 172 172.6 -2% 0% 688.4 698 -1%

Lead Sales Volume 52 48 44 42 47.6 -8% 13% 179.8 197 -9%

Total Metal Sales 229 215 212 214 220.2 -4% 3% 868.2 895 -3%

Silver Sales Volume 199 155 135 153 143.6 -28% -6% 610 687 -11%

Segment Revenue Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY (%) QoQ (%) FY20 FY19 YoY (%)

Refined Zinc 36,890 35,100 30,510 31,650 29,200 -21% -8% 1,26,590 1,44,750 -13%

Refined Lead 8,090 6,840 6,720 6,520 6,920 -14% 6% 26,456 31,580 -16%

Silver 7,450 5,760 5,770 6,900 6,010 -19% -13% 25,493 25,690 -1%

Others 2,480 2,170 2,110 1,650 1,780 -28% 8% 8,179 9,160 -11%

Total Revenue 54,910 49,870 45,110 46,720 43,910 -20% -6% 1,86,717 2,11,180 -12%

Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 YoY (%) QoQ (%) FY20 FY19 YoY (%)

Zinc - Realization ($/t) 2,958 3,019 2,590 2,592 2,335 -21% -10% 2,627 2,968 -12%

Zinc - LME ($/t) 2,702 2,763 2,348 2,388 2,128 -21% -11% 2,402 2,743 -12%

Premium over LME - ($/t) 256 256 242 204 207 -19% 2% 225 225 0%

Lead - Realization ($/t) 2,208 2,054 2,182 2,186 2,007 -9% -8% 2,102 2,292 -8%

Lead - LME ($/t) 2,036 1,882 2,028 2,045 1,847 -9% -10% 1,952 2,121 -8%

Premium over LME - ($/t) 172 172 154 141 159 -7% 13% 150 171 -12%

CoP - Zinc (reported )(USD/t) 987 1,067 1,048 1,077 997 4% -7% 1,047 1,008 4%

CoP - Zinc (reported )(INR/t) 67,359 74,219 73,754 76,571 72,220 7% -6% 74,172 70,444 5%





May 22, 2020 | 5

Highlights of the conference call

Production has increased substantially since Apr: Production was shut for last 10 days in

March as Zinc was not included in the ESMA. Compared to 40% utilization at mines and

80% utilization at smelter, current production at both mines and smelters are at 80-90%

levels. Production run rate of 1mt of mined metal achieved in Q4FY20. Adjusting for

shutdown of 10 days in March, the run rate is 1.12mt.

Costs: The company is targeting 5-10% reduction in costs for FY21 over FY20. Employee

cost was down 43% on a qoq basis on account of a reversal of annual incentives. However,

the company has not resorted to layoffs and is producing at 80% + utilization levels across

mines and smelters through higher automation/digitization while maintaining requisite

safeguards required for Covid-19.

Cost of Production (CoP) for was $997/t vs. $1077/t in Q3. This was also aided by a

reversal of c.Rs750-800mn on account of employee incentives due to plant shutdown in

March. Adjusting for this, the CoP for the quarter would be c.$1050/t. About 40% of its cost

is USD-linked which is largely for imported coal.

Inventory: The company is currently carrying inventory of 35kt of MIC vs. its normal trend

of about 20kt. The additional inventory is on account of shutdown in the last 10 days of Mar

2020.

Projects update: The smelter residual recovery plant to be operational by Q3, Raw zinc

oxide treatment plant by Q4. The fumer plant at Chanderiya has been deferred to May-20.

Zawar backfill plant also deferred to May-20 (previously both projects were expected by

Feb-20). Ore hauling at RA mines have started, post the commissioning of shaft.

FY21 Guidance: Due to the ongoing pandemic situation, the company has deferred its

production and capex guidance for FY21 to Q2FY21. In terms of growth capex, the

company highlighted that the growth capex of USD100-120mn is still pending. However, at

this point in time, the company is conserving its cash flows and shall take decision on the

capex a clarity on Covid-19 emerges.

Revenue mix: During the pre-Covid times, domestic was 74% of the revenue, which has

reversed in Covid times when exports constitute 70% of total volumes. With steel plants

returning to higher level of utilization levels, the company believes the domestic sales can

increase again.

Industry update: c.15% of the zinc mines supply to be impacted due to Covid-19. At

current LME price of $1950/t, nearly 15% of mines are carrying negative cash flows and if

situation persists, these mines might be shut. In LatAM countries, where large zinc mines

are located, resumption of mines can be delayed due to the impact of Covid-19.




May 22, 2020 | 6

Exhibit 13: Changes in Estimates

Financials (Rs bn) FY21 FY22 FY23

Old New %change Old New %change New

Revenue 226.9 155.4 -31.5% 246.6 206.2 -16.4% 245.8

EBITDA 117.7 73.9 -37.2% 130.3 96.0 -26.3% 113.2

PAT 79.1 50.2 -36.5% 87.5 65.1 -25.7% 77.3

EPS 18.7 11.9 -36.4% 20.7 15.4 -25.6% 18.3

LME

Zinc ($/t) 2,500 1,969 -21.3% 2,500 2,000 -20.0% 2,100

Lead ($/t) 2,400 1,688 -29.7% 2,400 1,700 -29.2% 1,800

FX (USD/INR 70 76 8.6% 70 75 7.1% 76

Sales Volume

Zinc (kt) 773 688 -10.9% 842 827 -1.7% 907

Lead (kt) 220 180 -18.3% 233 208 -10.7% 249

Total Refined Metal (kt) 993 868 -12.6% 1,075 1,035 -3.7% 1,156

Silver (t) 748 610 -18.4% 816 707 -13.3% 872


Exhibit 14: Valuation

Valuation UoM FY22E

EBITDA Rs bn 96

Multiple x 6

EV Rs bn 576

Net Debt Rs bn -215

Implied Market cap Rs bn 792

No. of Shares mn 4,225

TP Rs 187


Exhibit 15: Peer Comparison

Bloomberg Consensus M. Cap PE (x) EV/EBITDA (x) PB (x) ROE (x)

Estimates USD

mn

CY19/

FY20

CY20/

FY21

CY21/

FY22

CY19/

FY20

CY20/

FY21

CY21/

FY22

CY19/

FY20

CY20/

FY21

CY21/

FY22

CY19/

FY20

CY20/

FY21

CY21/

FY22

Hindustan Zinc Ltd 9,809 8.8 11.6 16.5 5.70 6.93 5.32 1.77 1.86 1.86 18.41 12.77 16.92

Korea Zinc Co Ltd 5,797 10.74 11.34 10.71 4.87 4.52 4.22 1.04 0.98 0.93 9.94 8.92 8.97

Teck Resources Ltd 4,877 4.44 18.18 6.14 2.45 5.51 4.04 0.30 0.31 0.30 6.94 1.60 4.27

Yunnan Chihong

Zinc 5,797 10.74 11.34 10.71 4.87 4.52 4.22 1.04 0.98 0.93 9.94 8.92 8.97

Glencore PLC 24,526 10.83 40.02 13.44 4.58 5.66 4.52 0.60 0.61 0.62 4.03 1.63 3.18





May 22, 2020 | 7

Key Financials (Standalone)

Income Statement

Y/E Mar (Rs mn) FY19 FY20 FY21E FY22E FY23E

Revenue 2,11,180 1,85,610 1,55,370 2,06,240 2,45,819

Expenditure 1,04,480 97,140 81,456 1,10,213 1,32,628

EBITDA 1,06,700 88,470 73,914 96,028 1,13,191

Depreciation 18,830 22,790 22,215 24,332 26,449

EBIT 87,870 65,680 51,699 71,695 86,742

Other Income 17,820 19,340 15,274 15,043 16,276

Interest expenses 1,130 1,120 0 0 0

PBT 1,04,560 83,900 66,973 86,738 1,03,017

Tax 25,000 15,850 16,743 21,685 25,754

Extraordinary Items 0 0 0 0 0

Minority Int./Income from Assoc. 0 0 0 0 0

Reported Net Income 79,560 68,050 50,230 65,054 77,263

Adjusted PAT 79,560 68,050 50,230 65,054 77,263

Balance Sheet


Equity share capital 8,450 8,450 8,450 8,450 8,450

Reserves & surplus 3,27,600 3,94,650 3,75,162 3,76,836 3,90,719

Net worth 3,36,050 4,03,100 3,83,612 3,85,286 3,99,169

Minority Interest 0 0 0 0 0

Loan Funds 9,640 10,900 10,900 10,900 10,900

Net deferred tax liability (19,250) (18,220) (18,220) (18,220) (18,220)

Total Liabilities 3,26,440 3,95,780 3,76,292 3,77,966 3,91,849

Net block 1,66,940 1,78,380 1,56,435 1,51,903 1,45,253

Investment 0 0 0 0 0

Current Assets 2,15,850 2,48,260 2,31,912 2,35,286 2,74,242

Cash & bank balance 1,95,110 2,22,070 2,14,322 2,15,469 2,49,547

Other Current Assets 3,180 3,680 2,331 3,094 3,687

Current liabilities & Provision 62,960 60,320 57,625 64,794 73,217

Net current assets 1,52,890 1,87,940 1,74,287 1,70,493 2,01,025

Misc. exp 0 0 0 0 0

Total Assets 3,42,370 3,91,210 3,65,612 3,67,286 3,81,169

Cash Flow


PBT (Ex-Other income) (NI+Dep) 1,04,560 83,900 66,973 86,738 1,03,017

Other Non-Cash items (690) (970) 0 0 0

Chg in working cap (3,760) (11,190) 5,905 4,941 3,545

Operating Cashflow 77,820 66,190 78,350 94,327 1,07,257

Capital expenditure (43,930) (36,370) (10,270) (29,800) (9,800)

Free Cash Flow 33,890 29,820 68,080 64,527 97,457

Investments 0 (3,56,120) 0 0 0

Other Investing Cash Flow 7,340 5,190 0 0 0

Investing Cashflow (36,590) (26,480) 4,730 (14,800) (9,800)

Equity Capital Raised 0 0 0 0 0

Loans Taken / (Repaid) 25,380 0 (6,110) 0 0

Dividend paid (incl tax) (84,500) 0 (69,718) (63,380) (63,380)

Other Financing Cash Flow (18,330) (19,240) 0 0 0

Financing Cashflow (78,580) (20,740) (75,828) (63,380) (63,380)

Net chg in cash (37,350) 18,970 7,252 16,147 34,077

Opening cash position 19,640 230 18,980 26,232 42,379

Closing cash position (17,710) 19,200 26,232 42,379 76,457





May 22, 2020 | 8

Key Ratios

Profitability (%) FY19 FY20 FY21E FY22E FY23E

EBITDA Margin 50.5 47.7 47.6 46.6 46.0

EBIT Margin 41.6 35.4 33.3 34.8 35.3

Effective Tax Rate 23.9 18.9 25.0 25.0 25.0

Net Margin 37.7 36.7 32.3 31.5 31.4

ROCE 31.4 23.5 17.3 23.0 26.8

ROE 22.9 18.4 12.8 16.9 19.7

RoIC 84.3 48.8 39.7 64.2 85.2

Per Share Data (Rs) FY19 FY20 FY21E FY22E FY23E

EPS 18.8 16.1 11.9 15.4 18.3

CEPS 23.3 21.5 17.1 21.2 24.5

BVPS 79.5 95.4 90.8 91.2 94.5

DPS 20.0 0.0 16.5 15.0 15.0

Valuations (x) FY19 FY20 FY21E FY22E FY23E

PER 9.0 10.5 14.2 11.0 9.3

P/CEPS 7.3 7.9 9.9 8.0 6.9

P/BV 2.1 1.8 1.9 1.9 1.8

EV / Sales 2.5 2.7 3.3 2.5 1.9

EV / EBITDA 5.0 5.7 6.9 5.3 4.2

Dividend Yield (%) 11.8 0.0 9.7 8.9 8.9

Gearing Ratio (x) FY19 FY20 FY21E FY22E FY23E

Net Debt/ Equity (0.6) (0.5) (0.5) (0.5) (0.6)

Net Debt/EBIDTA (1.7) (2.4) (2.8) (2.1) (2.1)

Working Cap Cycle (days) (73.0) (67.1) (94.1) (79.6) (72.0)

Growth (%) FY19 FY20 FY21E FY22E FY23E

Revenue (4.4) (12.1) (16.3) 32.7 19.2

EBITDA (13.1) (17.1) (16.5) 29.9 17.9

EBIT (18.6) (25.3) (21.3) 38.7 21.0

PAT (14.2) (14.5) (26.2) 29.5 18.8

Quarterly (Rs mn) Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20

Revenue 54,910 49,870 45,110 46,720 43,910

EBITDA 27,890 24,770 21,170 22,890 19,640

EBITDA Margin (%) 50.8 49.7 46.9 49.0 44.7

PAT 20,120 17,650 20,330 16,200 12,940

EPS (Rs) 4.8 4.2 4.8 3.8 3.1


Shareholding Pattern (%) Mar-19 Jun-19 Sep-19 Dec-19 Mar-20

Promoters 64.9 64.9 64.9 64.9 64.9

FIIs 1.5 1.4 1.3 1.1 1.0

DIIs 2.4 2.6 2.6 2.7 2.7

Public and Others 31.1 31.2 31.2 31.3 31.4

Source: Capitaline




May 22, 2020 | 9

RECOMMENDATION HISTORY TABLE

Date Closing

Price TP

Period (months)

Rating Analyst

22-Jan-20 209 220 12m Hold Vishal Chandak

30-Oct-19 213 242 12m Hold Vishal Chandak

19-Jul-19 220 247 12m Hold Vishal Chandak

03-May-19 275 285 12m Hold Vishal Chandak

21-Jan-19 268 270 12m Hold Vishal Chandak

22-Oct-18 282 294 12m Hold kamal Sahoo

23-Jul-18 268 325 12m Hold Goutam Chakraborty

08-May-18 301 325 12m Hold Goutam Chakraborty

02-May-18 308 325 12m Hold Goutam Chakraborty

01-Mar-18 316 309 12m Hold Goutam Chakraborty

01-Nov-17 325 309 12m Hold Goutam Chakraborty

23-Oct-17 319 309 12m Hold Goutam Chakraborty

11-Sep-17 309 298 12m Hold Goutam Chakraborty

05-Sep-17 304 298 12m Hold Goutam Chakraborty

20-Jul-17 280 293 12m Hold Goutam Chakraborty


RECOMMENDATION HISTORY CHART

Source: Bloomberg, Company, Emkay Research

120

166

212

258

304

350

24

-Ma

y-1

7

21

-No

v-1

7

21

-Ma

y-1

8

18

-No

v-1

8

18

-Ma

y-1

9

15

-No

v-1

9

14

-Ma

y-2

0

BUY Hold SellAccumulate Reduce PriceTarget Price




May 22, 2020| 10

Emkay Alpha Portfolio – Metals & Mining

EAP sector portfolio

Company Name BSE200 Weight

EAP Weight

OW/UW (%)

OW/UW (bps)

EAP Weight (Normalised)

Metals & Mining 2.27 2.23 -1% -3 100.00

Coal India 0.46 0.43 -5% -2 19.17

Hindalco 0.36 0.40 10% 4 17.63

Hindustan Zinc 0.07 0.08 10% 1 3.60

Jindal Stainless 0.00 0.00 NA 0 0.00

Jindal Stainless Hisar 0.00 0.00 NA 0 0.00

JSW Steel 0.36 0.39 10% 4 17.37

MOIL 0.00 0.00 NA 0 0.00

National Aluminium Co 0.05 0.05 -10% -1 2.05

NMDC 0.13 0.13 0% 0 5.55

SAIL 0.06 0.05 -10% -1 2.33

Tata Steel 0.44 0.33 -25% -11 14.65

Vedanta 0.33 0.37 10% 3 16.20

Cash 0.00 0.03 NA 3 1.44

Source: Emkay Research

* Not under coverage: Equal Weight

High Conviction/Strong Over Weight High Conviction/Strong Under Weight

Sector portfolio NAV

Base Latest

1-Apr-19 19-Aug-19 20-Nov-19 19-Feb-20 20-Apr-20 20-May-20

EAP - Metals & Mining 100.0 77.6 79.8 80.1 55.5 54.2

BSE200 Neutral Weighted Portfolio (ETF) 100.0 77.5 80.0 80.4 54.1 52.7

*Performance measurement base date 1st April 2019


NAV chart


Please see our model portfolio (Emkay Alpha Portfolio): SMID

Please see our model portfolio (Emkay Alpha Portfolio): Nifty

“Emkay Alpha Portfolio – SMID and Nifty are a supporting document to the Emkay Alpha

Portfolios Report and is updated on regular intervals”

45

57

69

81

93

105

Apr-19 May-19 Jul-19 Sep-19 Oct-19 Dec-19 Feb-20 Mar-20 May-20

NAV

EAP - Metals & Mining BSE200 Neutral Weighted Portfolio (ETF)

Analyst: Vishal Chandak

Contact Details

[email protected]

+91 22 6612 1275

Sector

Metals and Mining

Analyst bio

Vishal Chandak is a CA and MBA

(Finance). He brings in over 16 years of

experience, including seven years in the

corporate side, with balance being on

both the buy side and sell side. Currently,

his team tracks 12 stocks in the Metals

and Mining space.


https://web3.emkayglobal.com/ResearchAccess/Upload/SMID_May20.pdf

https://web3.emkayglobal.com/ResearchAccess/Upload/Nifty_May20.pdf

mailto:[email protected]



May 22, 2020| 11

Emkay Rating Distribution

Ratings Expected Return within the next 12-18 months.

BUY Over 15%

HOLD Between -5% to 15%

SELL Below -5%

Completed Date: 22 May 2020 09:21:36 (SGT) Dissemination Date: 22 May 2020 09:22:36 (SGT)

Sources for all charts and tables are Emkay Research unless otherwise specified.

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May 22, 2020| 12

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May 22, 2020| 13

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Documents

Refer to important disclosures at the end of this report ...vid.investmentguruindia.com/report/2020/May/Hindustan Zinc Q4FY2… · Hindustan Zinc (LHS) Rel to Nifty (RHS) What did