The stock of India’s only copper miner gained 10.5 percent to ₹366.25 per share after copper prices surged to a 15-month high.
At 1:45 p.m, Hindustan Copper Ltd. shares were trading at ₹356 per share, up 7.4 percent on the National Stock Exchange from the previous close price. The company has a market capitalization of ₹1,59,210 crore.
Copper prices have surged nearly 10% this year due to disruptions at major mines, threatening refined metal production at Chinese plants, which supply over half of the world’s copper. According to Bloomberg,.
Global copper prices are trading at $9,484 per tonne, nearing a 15-month high, with futures surpassing $4.27 per pound amid tightening supply and optimistic demand forecasts.
Supply constraints, including disruptions at major African mines like the Cobre mine in Panama and Anglo-America’s reduced copper output, have fueled a rise in copper prices by curbing refined metal production.
Moreover, an uptick in the global manufacturing sector has heightened copper demand due to its vital role in industrial applications. The Federal Reserve’s anticipated move towards looser monetary policy in 2023 has further buoyed expectations for the global economy, thus underpinning copper prices.
Hindustan Copper Limited (HCL) was formed to take over from National Mineral Development Corporation Ltd. It is the first Indian PSU and the only vertically integrated copper producing company. HCL is engaged in various processes, right from copper mining to the final stage of converting copper into saleable products.
The company operates in the Singbhum Copper Belt in Jharkhand, where copper is locally mined.
The company reported a 28 percent decrease in revenue year on year, from ₹557 crore in Q3FY23 to ₹399 crore in Q3FY24. During the same period, net profit decreased by 10 percent from ₹80 crore to ₹63 crore.
Hindustan Copper Ltd shares have gained 142% in the last six months and 259% in a last 12 months.
The government holds a 66% stake in the Hindustan Copper, while LIC possesses an 8.17% stake. Additionally, Quant Smallcap Fund and SBI PSU Fund each hold stakes of 1.76% and 1.23% in the stock, respectively.
Written by Omkar Chitnis
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