Vous êtes sur la page 1sur 12

2QFY2012 Result Update | Base Metals

October 19, 2011

Hindustan Zinc
Performance Highlights

ACCUMULATE
CMP Target Price
2QFY11 % chg (yoy) 1QFY12 % chg (qoq)

`121 `139
12 months

Particulars (` cr) Net sales EBITDA EBITDA margin (%) Adjusted PAT

2QFY12

Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code

2,593 1,465 56.5 1,369

2,163 1,125 52.0 970

19.9 30.2 445bp 41.1

2,821 1,592 56.4 1,495

(8.1) (8.0) 4bp (8.5)


Base Metals 51,232 0.9 155/109 146358 2 17,085 5,139 HZNC.BO HZ@IN

Source: Company, Angel Research

For 2QFY2012, Hindustan Zincs (HZL) net revenue at `2,593cr was in-line with our estimate of `2,643cr, while adjusted PAT at `1,369cr was above our estimate of `1,265cr. We recommend Accumulate on the stock. Robust top-line performance in 2QFY2012: For 2QFY2012, HZLs net revenue increased by 19.9% yoy to `2,593cr on account of higher sales volume and realization. Zinc, lead and silver sales volumes grew by 5.0%, 1.6% and 12.4% yoy to 184kt, 15kt and 41,454kg, respectively. Average zinc, lead and silver realization increased by 7.4%, 14.2% and 96.6% yoy, respectively. Strong growth in net profit: Zinc cost of production (excluding royalty) stood at US$847/tonne in 2QFY2012 compared to US$874/tonne in 1QFY2012, reflecting the qoq INR depreciation against the USD. EBITDA margin expanded by 445bp yoy to 56.5% on account of higher realization. EBITDA grew by 30.2% yoy to `1,465cr. Further, other income was higher by 110.2% yoy to `387cr, which resulted in adjusted PAT growing by 41.1% yoy to `1,369cr. Outlook and valuation: Currently, the stock is trading at 5.7x FY2012E and 3.9x FY2013E EV/EBITDA. We expect HZL to benefit from the expansion of zinc-lead smelting capacity during FY2012-13. Furthermore, HZLs expansion in the silver-rich Sindesar Khurd mine should result in robust bottom-line growth since there are no additional direct costs involved in silver mining. The companys

Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 64.9 1.8 1.3 32.0

Abs. (%) Sensex Hindustan Zinc

3m (11.5)

1yr

3yr 67.1

(8.4) (14.5)

(2.0) 336.2

cash and equivalents stood at `16,229cr as of September 30, 2011 (cash per share - `38.4). We recommend Accumulate on the stock.
Key financials
Y/E March (` cr) Net sales % chg Net profit % chg EPS (`) EBITDA margin (%) P/E (x) P/BV (x) RoE (%) RoCE (%) EV/Sales (x) EV/EBITDA (x)
Source: Company, Angel Research

FY2010 8,017 41.1 4,041 48.2 9.6 58.3 12.7 2.8 24.9 26.4 4.9 8.4

FY2011 9,912 23.6 4,900 21.3 11.6 55.4 10.5 2.3 24.1 24.3 3.7 6.6

FY2012E 10,611 7.0 5,285 7.8 12.5 52.4 9.7 1.9 21.3 20.2 3.0 5.7

FY2013E 12,606 18.8 6,328 19.7 15.0 52.8 8.1 1.6 21.1 20.2 2.1 3.9

Bhavesh Chauhan
Tel: 022- 39357800 Ext: 6821 Bhaveshu.chauhan@angelbroking.com

Please refer to important disclosures at the end of this report

Hindustan Zinc | 2QFY2012 Result Update

Exhibit 1: 2QFY2012 performance


(` cr) Net sales Mining and mfg. expenses % of Net sales Mining royalty % of Net sales Staff cost % of Net sales Admin and selling % of Net sales Total expenditure % of Net sales Operating income EBITDA % margin Interest Depreciation Other income Exceptional items Profit before tax % of Net sales Provision for tax % of PBT Profit after tax % of Net sales Adjusted net profit Source: Company, Angel Research 2QFY12 2QFY11 yoy % 1QFY12 qoq%

2,593 747 28.8 215 8.3 129 5.0 81 3.1 1,172 45.2 43.3 1,465 56.5 12 146 387 24 1,670 64.4 325 19.5 1,345 51.8 1,369

2,163 714 33.0 178 8.2 115 5.3 69 3.2 1,076 49.7 38.2 1,125 52.0 (1) 116 184 21 1,173 54.2 224 19.1 949 43.9 970

19.9 4.7 20.8 11.7 18.1 8.9 13.5 30.2

2,821 854 30.3 194 6.9 127 4.5 80 2.8 1,255 44.5 26 1,592 56.4 6

2,593 747 28.8 215 8.3 129 5.0 81 3.1 1,172 45.2 43.3 1,465 56.5 12 146 387 24 1,670 64.4 325 19.5 1,345 51.8 1,369

25.6 110.2 42.4 45.3 41.7 41.1

135 355 (4) 1,802 63.9 307 17.1 1,495 53.0 1,495

Exhibit 2: 2QFY2012 Actual vs. Angel estimates


(` cr) Net sales EBITDA EBITDA margin (%) PBT Adjusted PAT
Source: Company, Angel Research

Actual 2,593 1,465 56.5 1,670 1,369

Estimates 2,643 1,321 50.0 1,542 1,265

chg (%) (1.9) 10.9 651bp 8.3 8.2

Higher sales volume and realization aid top-line growth


For 2QFY2012, HZLs net revenue increased by 19.9% yoy to `2,593cr (in-line with our estimate of `2,643cr) on account of higher sales volume and realization. Zinc, lead and silver sales volumes grew by 5.0%, 1.6% and 12.4% yoy to 184kt, 15kt and 41,454kg, respectively. The company did not sell any concentrates during the quarter. Average zinc, lead and silver realization increased by 7.4%, 14.2% and 96.6% yoy, respectively.

October 19, 2011

Hindustan Zinc | 2QFY2012 Result Update

Exhibit 3: Zinc realization stood at US$2,325/tonne


210,000 180,000 150,000 3,000 2,500

Exhibit 4: Lead realization stood at US$2,581/tonne


25,000 20,000 3,500 3,000 2,500

(US $/tonne)

(tonnes)

(tonnes)

120,000 90,000 60,000 30,000 0 2QFY09 1QFY10 4QFY10 3QFY11 2QFY12 Volume (LHS) Realisation (RHS)

15,000 10,000 5,000 0 2QFY09 1QFY10 4QFY10 3QFY11 2QFY12 Volume (LHS) Realisation (RHS)

1,500 1,000 500 0

2,000 1,500 1,000 500 0

Source: Company, Angel Research

Source: Company, Angel Research

Operating performance
Cost of production for zinc (excluding royalty) stood at US$847/tonne in 2QFY2012 compared to US$874/tonne in 1QFY2012, reflecting the qoq INR depreciation against the USD. EBITDA margin expanded by 445bp yoy to 56.5% on account of higher realization. EBITDA grew by 30.2% yoy to `1,465cr. Further, other income was higher by 110.2% yoy to `387cr, which resulted in net profit growing by 41.7% yoy to `1,345cr despite depreciation increasing by 25.6% yoy to `146cr and higher tax rate at 19.5%. Excluding exceptional items (`24cr in 2QFY2012 and `21cr in 2QFY2011), adjusted net profit grew by 41.1% yoy to `1,369cr (higher than our estimate of `1,265cr). Exhibit 5: EBITDA and EBITDA margin trend
2,100 1,800 1,500 60 80

Exhibit 6: Net profit and net profit margin trend


2,100 1,800 1,500 60 50 40

(` cr)

(` cr)

(%)

900 600 300 0 2QFY09 4QFY09 2QFY10 4QFY10 2QFY11 4QFY11 2QFY12 EBITDA (LHS) EBITDA margins (RHS)

900 600 300

20 10 0 2QFY09 4QFY09 2QFY10 4QFY10 2QFY11 4QFY11 2QFY12 Net profit (LHS) Net profit margins (RHS)

20 0

Source: Company, Angel Research

Source: Company, Angel Research

Expansion projects
HZL commissioned a 100ktpa lead smelter at Rajpura Dariba during 2QFY2012. The companys zinc and lead capacity now stands at 1.1mn tonnes per annum. The company expects to ramp up Sindesar Khurd mines capacity to 2mn tonnes per annum by the end of FY2012, in-line with its previous guidance.

October 19, 2011

(%)

1,200

40

1,200

30

(US $/tonne)

2,000

Hindustan Zinc | 2QFY2012 Result Update

Outlook
Global zinc metal market likely to remain in surplus
As per International Lead and Zinc Study Group (ILZSG), global zinc usage is expected to grow by 2.2% to 12.6mn tonnes in CY2011 and 3.9% to 13.4mn tonnes in CY2012. Refined zinc production is expected to grow by 4.3% to 12.8mn tonnes in CY2011 and by 4.7% to 13.4mn tonnes in CY2012. Hence, global zinc metal supply is likely to remain in surplus by over 317,000 tonnes in CY2011 and modest 135,000 tonnes in CY2012.

Exhibit 7: Zinc prices and inventory levels


5,400 4,500
(US $/tonne)

2,700 1,800 900 0


Aug-07 Dec-09 Apr-05 Mar-08 Nov-05 Oct-08 Jul-10 Feb-11 May-09 Sep-11 Jun-06 Jan-07

Inventory (RHS)
Source: Bloomberg, Angel Research

Zinc prices (LHS)

Lead Metal surplus at 188,000 tonnes in CY2011


As per ILZSG, global lead usage is expected to grow by 6.1% yoy to 10.2mn tonnes in CY2011 and 4.0% to 10.6mn tonnes in CY2012. However, lead production is also expected to grow by 7.3% yoy to 10.3mn tonnes and by 3.1% to 10.7mn tonnes in CY2012. Hence, lead metal is expected to remain in surplus by 188,000 tonnes in CY2011 and 97,000 in CY2012.

October 19, 2011

(tonnes)

3,600

1,000,000 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0

Hindustan Zinc | 2QFY2012 Result Update

Exhibit 8: Lead prices and inventory levels


4,500 3,600 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0

(US $/tonne)

1,800 900 0

Oct-08

Feb-11

Nov-05

May-09

Aug-07

Dec-09

Inventory (RHS)
Source: Bloomberg, Angel Research

Mar-08

Lead prices (LHS)

Current zinc prices nears marginal cost of production


Zinc and lead prices have declined by 23.6% and 25.4% during August-October 2011. At US$1,800-1,900, zinc prices stand near their marginal cost of production. Hence, we believe probability of a further decline from these levels remains lower.

Mining in Kayar could be the next phase of growth


Although the company has over US$3bn of cash reserves currently, chances for acquisitions remain muted in our view. The company has commenced work at its underground Kayar mine, which has 11mn tonnes of high-grade reserves (10-12% zinc content). HZL aims to mine 1mn tonnes per annum once it is fully operational. However, we currently lack the timelines for production from this mine. Further, HZL is currently exploring over 6,200 sq. km. area in 10 Reconnaissance Permits. In the past seven years, the companys exploration activities have resulted in addition of 167mn tonnes of ore (net of depletions) to its reserve and resource base.

October 19, 2011

Sep-11

Jun-06

Apr-05

Jan-07

Jul-10

(tonnes)

2,700

Hindustan Zinc | 2QFY2012 Result Update

Valuation
Currently, the stock is trading at 5.7x FY2012E and 3.9x FY2013E EV/EBITDA. We expect HZL to benefit from the expansion of its zinc-lead smelting capacity during FY2012-13. Furthermore, HZLs expansion in the silver-rich Sindesar Khurd mine should result in robust bottom-line growth since there are no additional direct costs involved in silver mining. The companys cash and equivalents stood at `16,229cr as of September 30, 2011 (cash per share - `38.4). We recommend Accumulate on the stock.

Exhibit 9: Key assumptions


Earlier LME prices (US$/tonne) Zinc Lead Silver (`/kg) Sales volume (tonnes) Zinc metal Lead metal Silver Source: Angel Research FY12E FY13E Revised FY12E FY13E

2,300 2,500 55,000 738,360 86,850 225,000

2,300 2,500 55,000 830,655 91,193 225,001

2,090 2,226 55,000 755,940 77,200 225,000

2,185 2,321 55,000 830,655 141,855 225,001

Exhibit 10: EPS Angel forecast vs. consensus


Year (%) FY2012E FY2013E
Source: Bloomberg, Angel Research

Angel forecast
12.5 15.0

Bloomberg consensus
13.9 15.3

Variation (%)
(10.0) (2.1)

Exhibit 11: EV/EBITDA band


70,000 60,000 50,000

(`cr)

40,000 30,000 20,000 10,000 0 Apr-04 Jul-05 2x Oct-06 4x Jan-08 6x 8x Apr-09 10x Jul-10 Oct-11

Source: Bloomberg, Angel Research

October 19, 2011

Hindustan Zinc | 2QFY2012 Result Update

Exhibit 12: P/E band


250 200 150
(`)

100 50 0 Apr-03 Apr-04 Apr-05 Apr-06


2x

Apr-07
6x

Apr-08
10x

Apr-09

Apr-10

Apr-11

14x

Source: Bloomberg, Angel Research

Exhibit 13: P/BV band


400 350 300 250
(`)

200 150 100 50 0 Apr-03 Apr-04 Apr-05 Apr-06 Apr-07 2.0x Apr-08 3.5x Apr-09 5.0x Apr-10 Apr-11 0.5x

Source: Bloomberg, Angel Research

Exhibit 14: Recommendation summary


Company CMP (`) Target Price (`) Reco. Mcap (` cr) Upside (%) P/E (x) P/BV (x) EV/EBITDA (x) RoE (%) RoCE (%) FY12E FY13E FY12E FY13E FY12E FY13E FY12E FY13E FY12E FY13E

Hindalco Nalco Sterlite HZL

128 61 119 121

184 158 139

Buy Neutral Buy Accum.

24,439 15,683 40,037 51,232

44 30 33 14.4

5.9 10.2 7.3 9.7

5.4 8.8 5.3 8.1

0.9 1.4 0.9 1.9

0.8 1.4 0.7 1.6

4.4 5.0 4.8 5.7

4.1 4.1 2.9 3.9

16.2 13.7 12.4 21.3

15.3 15.7 14.8 21.1

10.4 13.1 7.8 20.2

10.2 15.1 11.5 20.2

Source: Company, Angel Research

October 19, 2011

Hindustan Zinc | 2QFY2012 Result Update

Profit & loss statement


Y/E March (` cr) Net sales Other operating income Total operating income % chg Total expenditure Net raw materials Other Mfg. costs Personnel Other EBITDA % chg % EBITDA margin Depreciation EBIT % chg (% of Net sales) Interest & other charges Other income (% of PBT) Share in profit of associates Recurring PBT % chg Extraordinary inc/(expense) PBT (reported) Tax (% of PBT) PAT (reported) Add: Share of earnings of asso. Less: Minority interest Extra. expense/(inc.) Net income (reported) Adj. net income % chg (% of Net sales) Basic EPS (`) Fully Diluted EPS (`) % chg 7,878 (8.0) 2,499 1,352 511 308 328 5,378 (16.1) 68.3 221 5,158 (17.5) 65.5 24 852 14.2 5,985 (7.3) 5,985 1,589 26.6 4,396 4,396 4,396 (1.0) 55.8 10.4 10.4 (1.0) 5,680 (27.9) 2,946 1,906 364 365 311 2,734 (49.2) 48.1 285 2,449 (52.5) 43.1 22 931 27.7 3,358 (43.9) 3,358 631 18.8 2,728 2,728 2,728 (38.0) 48.0 6.5 6.5 (38.0) FY2008 FY2009 FY2010 FY2011 7,878 5,680 8,017 122.0 8,139 43.3 3,347 1,961 613 457 316 4,792 75.3 58.3 334 4,458 82.0 55.6 44 600 12.0 5,014 49.3 5,014 973 19.4 4,041 4,041 4,041 48.2 49.7 9.6 9.6 48.2 9,912 127 10,039 23.3 4,416 2,754 803 511 349 5,623 17.3 55.4 475 5,148 15.5 51.9 19 852 14.2 5,981 19.3 21.2 5,960 1,059 17.8 4,900 4,900 4,900 21.3 48.8 11.6 11.6 21.3 FY2012E FY2013E

10,611 128 10,739 7.0 5,051 3,289 859 531 371 5,688 1.2 52.4 477 5,211 1.2 49.1 20 1,273 19.7 6,465 8.1 6,465 1,180 18.3 5,285 5,285 5,285 7.8 49.2 12.5 12.5 7.8

12,606 157 12,763 18.8 5,950 3,908 1,021 618 403 6,813 19.8 52.8 567 6,245 19.8 49.5 13 1,513 19.5 7,745 19.8 7,745 1,417 18.3 6,328 6,328 6,328 19.7 49.6 15.0 15.0 19.7

October 19, 2011

Hindustan Zinc | 2QFY2012 Result Update

Balance sheet
Y/E March (` cr) SOURCES OF FUNDS Equity share capital Reserves & surplus Shareholders funds Share warrants Minority interest Total loans Deferred tax liability Total liabilities APPLICATION OF FUNDS Gross block Less: Acc. depreciation Net Block Capital work-in-Progress Goodwill Investments Current assets Cash Loans & advances Other Current liabilities Net current assets Mis. exp. not written off Total assets 5,182 1,485 3,697 465 6,332 2,712 1,363 384 965 898 1,813 12,308 5,856 1,751 4,105 1,108 6,929 3,784 2,719 313 751 1,001 2,783 14,925 8,241 2,077 6,164 1,113 10,949 1,995 928 457 611 1,326 669 18,896 9,802 2,548 7,254 875 9,335 7,589 5,633 752 1,204 1,575 6,014 23,478 423 11,426 11,848 460 12,308 423 13,935 14,358 9 559 14,925 423 17,701 18,124 60 711 18,896 845 21,688 22,533 945 23,478 FY2008 FY2009 FY2010 FY2011 FY2012E FY2013E

845 26,232 27,077 945 28,022 10,802 3,026 7,777 575 9,335 12,377 10,172 752 1,453 2,042 10,335 28,022

845 32,065 32,910 945 33,855 11,329 3,593 7,736 275 9,335 18,427 16,001 752 1,674 1,918 16,509 33,855

Note: Cash and Bank balance include fixed deposits

October 19, 2011

Hindustan Zinc | 2QFY2012 Result Update

Cash flow statement


Y/E March (` cr) Profit before tax Depreciation Change in working capital Less: Other income Direct taxes paid Cash flow from operations (Inc.)/ Dec. in fixed assets (Inc.)/ Dec. in investments (Inc.)/ Dec. in loans and adv. Other income Cash flow from investing Issue of equity Inc./(Dec.) in loans Dividend paid Others Cash flow from financing Inc./(Dec.) in cash Opening cash bal. Closing cash bal. FY2008 5,985 222 376 (767) 1,529 4,288 (1,513) (1,407) (80) 226 (2,774) 247 24 (271) 1,243 120 1,363 FY2009 3,358 286 296 (777) 521 2,642 (1,374) (443) 71 (1,602) (3,348) 8 124 22 (137) (844) 3,563 2,719 FY2010 5,014 335 173 (563) 785 4,173 (2,247) (3,922) (96) (3,977) 43 198 33.0 (187) 8 919 928 FY2011 5,960 475 (239) (834.8) 1,116 4,244 (1,446) 1,870 28 (3,631) (60.1) 296 7.6 (363) 250 5,383 5,633 FY2012E FY2013E

6,465 477 (32) 1,180 5,730 (700) (700) 491 (491) 4,539 5,633 10,172

7,745 567 (98) 1,417 6,798 (227) (227) 742 (742) 5,829 10,172 16,001

2,288 (4,082.4)

October 19, 2011

10

Hindustan Zinc | 2QFY2012 Result Update

Key ratios
Y/E March Valuation ratio (x) P/E (on FDEPS) P/CEPS P/BV Dividend yield (%) EV/Sales EV/EBITDA EV/Total assets Per share data (`) EPS (Basic) EPS (fully diluted) Cash EPS DPS Book value DuPont analysis EBIT margin Tax retention ratio (%) Asset turnover (x) RoIC (Post-tax) Cost of debt (post tax) Leverage (x) Operating RoE Returns (%) RoCE (Pre-tax) Angel RoIC (pre-tax) RoE Turnover ratios (x) Asset turnover (gross block) Inventory (days) Receivables (days) Payables (days) WC cycle (days) Solvency ratios (x) Net debt to equity Net debt to EBITDA Interest coverage FY2008 FY2009 FY2010 FY2011 FY2012E FY2013E

11.7 11.1 4.3 4.1 5.5 8.1 3.5 10.4 10.4 10.9 5.0 28.0 65.5 73.4 2.0 94.5 94.5 51.0 149.1 45.1 1.8 76 21 52 34 (0.6) (1.4) 213.4

18.8 17.0 3.6 3.3 7.3 15.2 2.8 6.5 6.5 7.1 4.0 34.0 43.1 81.2 1.1 40.2 40.2 18.0 58.9 20.8 1.0 68 11 46 30 (0.7) (3.5) 111.9

12.7 11.7 2.8 4.9 4.9 8.4 2.1 9.6 9.6 10.4 6.0 42.9 55.6 80.6 1.3 59.3 59.3 26.4 88.5 24.9 1.1 49 7 52 11 (0.7) (2.5) 101.5

10.5 9.5 2.3 0.6 3.7 6.6 1.5 11.6 11.6 12.7 0.7 53.3 51.9 82.2 1.3 55.2 55.2 24.3 76.0 24.1 1.1 63 8 39 11 (0.7) (2.7) 265.4

9.7 8.9 1.9 1.2 3.0 5.7 1.1 12.5 12.5 13.6 1.5 64.1 49.1 81.8 1.3 50.6 50.6 20.2 66.9 21.3 1.0 63 12 50 18 (0.7) (3.4) 267.2

8.1 7.4 1.6 0.8 2.1 3.9 0.8 15.0 15.0 16.3 1.0 77.9 49.5 81.7 1.5 60.6 60.6 20.2 77.2 21.1 1.1 63 12 50 17 (0.8) (3.7) 495.4

October 19, 2011

11

Hindustan Zinc | 2QFY2012 Result Update

Research Team Tel: 022 - 39357800

E-mail: research@angelbroking.com

Website: www.angelbroking.com

DISCLAIMER
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamentals. The information in this document has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance, or other reasons that prevent us from doing so. This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced, redistributed or passed on, directly or indirectly. Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in connection with the use of this information. Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may have investment positions in the stocks recommended in this report.

Disclosure of Interest Statement 1. Analyst ownership of the stock 2. Angel and its Group companies ownership of the stock 3. Angel and its Group companies' Directors ownership of the stock 4. Broking relationship with company covered

Hindustan Zinc No No No No

Note: We have not considered any Exposure below `1 lakh for Angel, its Group companies and Directors.

Ratings (Returns) :

Buy (> 15%) Reduce (-5% to 15%)

Accumulate (5% to 15%) Sell (< -15%)

Neutral (-5 to 5%)

October 19, 2011

12