The government recently announced an incentive of 25% of the approved project cost to companies to boost exploration of critical minerals.
“This incentive will be provided through the National Mineral Exploration Trust and will help in the discovery of critical minerals in the country,” said Union Minister of Parliamentary Affairs, Coal, and Mines, Pralhad Venkatesh Joshi, in a post on X (formerly known as Twitter). Following the post, the shares of mining companies were trading in the green.
Return on Equity (ROE) is a gauge of a corporation’s profitability and how efficiently it generates those profits. The higher the ROE, the better a company is at converting its equity into profits.
Here are a few mining stocks with a high return on equity:
Coal India is mainly engaged in mining and production of coal and also operates coal washeries. The major consumers of the company are the power and steel sectors. Consumers from other sectors include cement, fertilisers, brick kilns etc.
The company has a return on equity of 54.02 percent. It has a market capitalization of ₹ 1,72,341 crores and its shares settled at ₹ 277.55 apiece. The company has a dividend yield of 8.67 percent.
Incorporated in 1966, Hindustan Zinc has a rich experience of more than five decades in Zinc-led mining and smelting. It is one of the lowest-cost producers of zinc globally and it is India’s only integrated producer of zinc, lead, and silver.
The company has a return on equity of 60.38 percent. It has a market capitalization of ₹ 1,32,992 crores and its shares settled at ₹ 321.20 apiece. The company has a dividend yield of 23.99 percent.
NMDC is engaged in the exploration and production of iron ore along with diamond, the production and sale of sponge iron and the generation and sale of wind power.
The company has a return on equity of 27.96 percent. It has a market capitalization of ₹ 41,688 crores and its shares settled at ₹ 150.20 apiece. The company has a dividend yield of 4.64 percent.
Gujarat Mineral Development Corporation is primarily engaged in 2 sectors — mining and power. Its projects include lignite, bauxite, fluorspar, multi-metal, manganese, power, wind and solar.
The company has a return on equity of 28.60 percent. It has a market capitalization of ₹ 9,251 crores and its shares settled at ₹ 280.80 apiece. The company has a dividend yield of 28.60 percent.
Written by Simran Bafna
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