Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Hindustan Zinc Ltd (NSE: HINDZINC) Q3 2026 Earnings Call dated Jan. 19, 2026
Corporate Participants:
Raksha Jain — Director of Investor Relations
Arun Misra — Chief Executive Officer & Whole Time Director
Sandeep Modi — Deputy Chief Financial Officer
Analysts:
Manav Gogia — Analyst
Pallav Agarwal — Analyst
Anirudh Nagpal — Analyst
Unidentified Participant
Sumangal Nevatia — Analyst
Unidentified Participant
Unidentified Participant
Ashish Kejriwal — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the third quarter and nine months FY26 earnings conference call host hosted by Hindustan Zinc. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms.
Raksha Jain, Director of Investor Relations of Hindustan Zenk. Thank you. And over to you.
Raksha Jain — Director of Investor Relations
Thank you operator and good evening ladies and gentlemen. Thank you for joining us today to discuss the third quarter and nine months results of FY26. In this call we will refer to our investor presentation available on our company’s website. Please note that today’s entire discussion will be covered by the Safe Harbor Cross mentioned on slide 2 of the presentation. Today we have our CEO Mr. Arun Mitra and CFO Mr. Sandeep Modi. The management will be discussing the operational and financial updates for the quarter followed by a Q and A session.
Now I would like to invite Mr. Arun Mishra to present the results. Over to you sir.
Arun Misra — Chief Executive Officer & Whole Time Director
Thank you Raksha. A very good evening to all of you. Thank you for joining us today for the third quarter and nine months FY26 results briefing. Before we begin the presentation, with profound sadness and a heavy heart that I share that during the quarter we lost Kailash in an unfortunate incident at our Rajpura Dariba mine. On behalf of the entire organization, I extend our deepest condolences to the Virid family. We stand firmly beside them in these difficult times and assured them of our unwavering support.
Such incidents are truly heartbreaking particularly as we continue to strengthen our safety first culture. Following a detailed investigation, we are implementing strong corrective and preventive measures with utmost urgency and the learnings are being disseminated through the organizations. The safety and well being of every individual remains paramount and this incident serves as a reminder of the need of the constant vigilance and the continuous improvement. The quarter has been one of our strongest.
We achieved the highest ever third quarter mined metal production since the underground transition along with record third quarter refined metal production. This was delivered alongside the lowest zinc cost of production including royalty in last five years. Scoring our structural cost, leadership and operational discipline advancing our sustainability journey. We flagged off 10 EV bulker trucks at our Diwari smelter in collaboration with Enviro Wheels Mobility Pvt Ltd with plans to scale the fleet to 40 vehicles.
Further reinforcing our sustainability leadership, the company achieved a global milestone by securing number one ranking in the S and P Global Corporate Sustainability Assessment 2025 for the third year in a row in mining and metals sector with an industry leading score of 90 out of 100. This recognition reflects our consistent commitment to the highest global standards of sustainability. Our efforts in corporate social responsibility have also been recognized with the Best CSR in Private Sector award at the Mining and Metals Excellence Awards 2025, acknowledging our sustained focus on creating a meaningful impact on local communities Moving to the market environment India continues to stand out as one of the brightest spots globally with manufacturing PMI firmly above 50 throughout the quarter.
The nation’s GDP growth for FY 2026 is projected at around 7.4% by the Reserve bank of India. Against a highly uncertain global macroeconomic backdrop, commodity prices have stayed buoyant supported by strong fundamentals. Zinc prices surged to around $3,350 per ton, the highest level since early 2023 driven by tight physical supply. Silver prices in particular wit rally of around 75% year on year, even reaching an all time high of over $93 per tryout in January. The inclusion of silver in the US Critical Minerals list and its relative undervaluation versus gold and strong festive demand from India attracted robust investor interest.
Despite such strong rally, the outlook for silver remains bullish. Turning to the operational performance, we delivered mined metal production of 276,000 tonnes our best ever third quarter since the underground transition. Taking nine month production to a record 799,000 tonnes we achieved highest ever third quarter refined metal production of 270,000 tons of with second highest nine months production of 766,000 tonnes. With the successful completion of debottlenecking at Chanderia Smelter and the earlier commissioned debottlenecking at Daribar smelter we added 21,000 tonnes to the overall refined metal capacity.
Earlier this year we completed the commissioning of 160,000 tons per annum roaster at Debary which has improved the overall plant availability. With this we are comfortable in delivering the refined metal production as committed. Our sellable silver Production stood at 158 tonnes up 10%. Sequentially. The contribution of the precious metal portfolio has increased to 44% of the profits making it uniquely placed to ride the silver wave and unlock full potential. We delivered silver production of 451 tons in nine months.
During the quarter we achieved five year lowest zinc cost of production excluding royalty of $940 per ton, better by 10% year on year and 5% sequentially. This achievement was in line with record operational performances. Higher domestic coal usage softened coal prices and higher by product realization and this was partly offset by higher mine development cost. Zinc cost of production excluding royalty for the nine months stood at its five year lowest of $980 per ton, well within the guided level.
The combination of lowest cost of production and record output resulted in all time high financial performance for the quarter and nine months. During the quarter we delivered record revenue of 10,980 crores of rupees and the highest ever EBITDA of 6,087 crores. The profit after taxes for the quarter surged 48% sequentially to 3,916 crore marking a new record for the company with respect to 2x growth projects of 250,000 tonnes per annum. Integrated zinc smelter at Debari and tailing reprocessing plant at Rampura Gucha.
We have logged in key EPC partners and groundwork has started. Both the projects are set to be completed by second quarter of FY29 and fourth quarter of FY28 respectively. As we advance into the next phase of our growth journey, Hindusanjing stands on a foundation of scale resilience and disciplined execution. Our robust balance sheet, sustainably low cost of production and best in class assets provide us with the confidence to invest through cycles and capture opportunities emerging from a favorable commodity environment.
Guided by an unwavering commitment to safety, sustainability and governance, we continue to strengthen our operational excellence while expanding our resource base and advancing strategic projects that will define our future growth. As global prices increasingly shift towards electrification, decarbonization and energy security, our focused diversification into metals critical to the energy transition positions well With a clear strategy, proven execution capabilities and the dedication of our people, we remain firmly committed to creating enduring values for all our stakeholders.
With this I now hand over to Sandeep for an update on the financial performance.
Sandeep Modi — Deputy Chief Financial Officer
Thank you Mr. Mishra and a very good evening everyone. The global environment continues to see uneven growth and geopolitical driven volatility. However, India remains a clear outperformer. The RBI has projected India’s GDP growth at 7.4% for a financial year FY26 significantly ahead of global average supported by strong domestic demand, sustained infrastructure led capex and policy continuity. While commodity prices are influenced by global macro sentiment, in the near term, underlying fundamentals remain influenced by the global constructive.
The recent rally in commodities reflects tightening supply dynamics and resilient demand and we believe this positive price trajectory is well supported against this backdrop. Our focus on cost leadership, operational discipline and balance sheet strength position us well to convert favorable macro and commodity trends into sustained value creation before moving to the financial performance. I am pleased to share that our integrated annual report of FY25 received platinum award at the prestigious LACP Spotlight Awards.
For the first time we were the number one among the Indian companies and the only Indian company in the global top 10, securing the 6th position worldwide reinforcing our commitment to strong governance, transparency and global best in class reporting practices. Turning to quarterly performance, this quarter marked a new milestone with record financial performance we delivered highest ever quarterly revenue of 10,980 crore up 28% quarter on quarter and 27% YoY driven by higher production, a favorable commodity environment, higher by product realization and rupee depreciation, we achieved record quarterly EBITDA of rupees 6087 crore up 36% quarter on quarter and split 34% y while maintaining our industry leading EBITDA margin of 55%.
The EBITDA growth was supported by record revenue and five year lowest quarterly zinc cop excluding royalty of $940 per ton driven by higher domestic coal usage, softened coal prices, increased production and high by product realization. Importantly, this is the first time where we also achieved the lowest third quarter zinc cop excluding royalty since underground transition. Underscoring the strength of our assets, effective use of technology and our disciplined execution in line with the strong operating performance and EBITDA, we delivered our best ever profit after tax of 3916 crore up 48% quarter on quarter and 46% y o y on a nine month basis we deliver historic high with record revenue of 27,300 crore, the highest ever EBIT of 14,415 crore and the best hour profit after tax of 8799 crore.
Zinc cost of production excluding royalty on a nine month basis stood at $980 per ton, the lowest in last five years well below guided levels. Our free cash flow before growth CAPEX as renewable energy investment for the quarter stood at 3,413 crore taking the nine month free cash flow generation before capex and re investment to 7,225 crore. We achieved net cash position of 329 crore at the end of December 25 in comparison to net debt position at the September end of 2547 crore. It is prudent to note that in the last nine months we contributed over 13,000 crore to the national exchequer of which 4,000 crore was contributed to the State of Rajasthan reflecting our continued role as a significant economic partner to both the state and the nation.
Consistent with our track record, the company continues to deliver strong shareholder returns of 35% over nine months, outperforming the Nifty 100 and Nifty metal indexes. As of December 25, we ranked third in the Nifty metal index and 33rd in the Nifty 100 with a market cap of around 2,50,000 crore compared to 1,95,000 crore at March 25. During the quarter, Hindustan Jing delivered return five times that of Nifty Hundred, reflecting our resilience, execution, excellence and sustained value creation for all stakeholders.
Overall, the quarter underscores the strength and resilience of our operating model and the consistency of our financial performance. Anchored by structural cost leadership and disciplined execution, supported by technology driven efficiency, continuous innovation and a robust sustainability framework, we are well aligned with India’s economic expansion and energy transition priorities. This positions Hindustan Jing to deliver resilient growth and long term value creation for shareholders, communities and a broader economy.
With this I now hand over to the operator for Q and A. Thank you.
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. In order to ensure that management is able to answer queries from all participants, kindly restrict your questions to two at a time. You may join back the queue for follow up questions. We’ll take our first question from the line of Manav Gogia from yes securities.
Please go ahead.
Manav Gogia
Very good evening. First of all congratulations on the wonderful result for this quarter. So my first question comes particularly to wanted to understand how the premiums are working especially for lead and silver because they have been higher than what historically has been seen. So could you throw some light on the same because we have also had a good amount of volumes for silver which were hedged at lower prices. So what sort of changes happened here?
Sandeep Modi
So as far as the premiums are concerned it is the part of our net sales realization and we separately don’t report the premium over the whatever we earn to the lme. But what we can say the premiums are in line with the market which we are getting in the India in case of lead in a domestic primary lead market share, our market share is 90% plus. So that is the thing on the lead and Silver, as you say, it’s quite volatile in the Indian market as well. So it has been over the MCX prices. It has been sometime discount physical delivery.
It has been sometime premiums as well. But we benchmark ourselves with the crisil and crisil and we have been doing in line with the whatever crisil has been publishing for the premium or discount for the month.
Manav Gogia
Okay. And can we expect a similar sort of, you know, range to be in the upcoming quarters as well?
Sandeep Modi
Yeah, absolutely.
Manav Gogia
You know, second question would be could you give us the number of hash quantities for Q3FY26.
Sandeep Modi
So his quantity for the QT FY26 was 47kt for zinc which got squared off and 5510 was the silver which got squared off within the quarter three.
Manav Gogia
Got it. And are we trying to hedge Further quantities for FY27 at higher prices or we looking for spot sales over there?
Sandeep Modi
So Manav, let me give the perspective. Hedging is not like playing with the prices in line with the global practices and Indian peers. Our objective has been for last two, three years to continue to follow the consistency in the strategic hedging for 10 to 20% of the volume. And that’s for the whole year. So that’s how we have been going on. And for the FY27 we are headed by 66kt of the zinc and silver by 56 ton at $58 per triumph and zinc at 31 17. That is for FY27 and FY26 we are he at silver for 68 ton at the price of 39 because that is the more thing we hazed in the month of June and July itself.
And for the quarter four we are haste for a zinc 53kt at a 2900. That is also the earlier haste price only. Hazel’s price only.
Manav Gogia
Okay. Okay. Now that is. That is quite helpful. Just one last, you know, question. I just wanted to know, would it be possible for you to give the targeted silver volumes for FY27 and how will the silver volumes look in Q4? Because Q3 has seen a good pickup from the earlier first half.
Arun Misra
Traditionally we do our best in Q4 so I am hoping that the same trend will continue because one of course all shutdowns are cleared and we will have more availability of equipment running as well as the temperature, weather and ambient conditions are favorable for both mine as well as smelter. So you can expect better than what we have reported in Q3 kind of a number if possible. Second is with the same. Can we throw some light on next year? I think let us carry our business plan sessions first.
That’s what we are undergoing now. And I think by April or May board meeting we should be able to give you the guidance for the next year.
Manav Gogia
Sure, that is quite helpful sir. Thank you so much and all the very best.
Operator
Thank you. Next question is from the line of Pallav Agarwal from antique stock broking. Please go ahead.
Pallav Agarwal
Yeah. Good evening sir and congratulations on the good performance. So a couple of questions. First one was you know on the cop you know you gave some reasons for you know the low cost of production. So how can we, you know how much of this is sustainable and you know going forward in Q4 can we expect a similar level of cop?
Sandeep Modi
Hello, Sandeep here. And this cop if you see the last quarter also we say it should be a sustained basis. As we said earlier the sustained cop should be between $950 to $1,000. That is a sustained level which we can do on a quarter basis. It may be depending varying upon the volume grade or some of the byproduct realization or some or any other items. But on a year basis you should be assuming $952,000 on sustained basis. Of course this year we expect to perform well below the guided.
Pallav Agarwal
Sure sir. Also so now that we probably reached a net cash position in Q3 so can we expect that March also should be a strong quarter. So if there are no further dividends then probably can we expect a net cash position at the end of Q4 as well? And what is any maturity of debt is there in the fourth quarter.
Sandeep Modi
So Pallavar, the maturity of debt is not very large. 1300 crore rupees q4 so that’s not a big issue. And I’m sure with the current as Mishraji has said volume normally remain we delivered quarter four is the best quarter within the year. And also the this bond prices and the structural cost reduction we should be in this direction. Only one thing, the growth capex which is $180 million till now till December we have spent as we move for the 2x a lot of partners we have to lock in. So we may be having around 300 million dollar total year growth capex.
So that is something which you can factor for the full year incremental say 120 million dollar extra spend in the growth capex.
Pallav Agarwal
Sure. And what would be the maintenance capex?
Sandeep Modi
Maintenance capex is routine which will be around 90 to 100 million dollar for Q4 and the whole year should be $400 million.
Pallav Agarwal
Okay. Okay. Thank you sir.
Operator
Thank you. We’ll take our next question from the line of Anirudh Nagpal from JM Financial. Please go ahead. Anirudh,
Anirudh Nagpal
Your line is unmuted.
Operator
Anirudh, can you use your handset mode please?
Anirudh Nagpal
Sure. Is it better?
Operator
Yes, please go ahead.
Anirudh Nagpal
Yeah. So congrats on a great set of numbers for the quarter. So my question was actually answered but I just had another question so can you please tell us if you are maintaining the FY26 guidance for mine metals and for silver? So are we expecting any rise in the silver volumes in 4Q or 680 is the guidance for FY26.
Sandeep Modi
So I think we revised the guidance in the October 680 plus minus 10 ton we should be closer to the silver guidance. One thing which I would like to also highlight that during the quarter company also sold a concentrate of the lead concentrate Given that there was a tightness in the market globally and at the same time the silver prices were quite higher. So it was a right good strategy from the getting the realization of the inventory and the realization of EBITDA so that we sold 21 ton equivalent to silver during the quarter three.
So you will have to. So from the guidance EBITDA point of view you should be adding that number in my view.
Anirudh Nagpal
Got it. Thanks.
Operator
Thank you. Next question is from the line of Pinakin from hsbc. Please go ahead.
Unidentified Participant
Yeah, thank you. Thank you very much. My first question is can you give us a sense of the cost of production without byproduct credits? I mean we just trying to understand how has the underlying cop moved X or byproduct.
Sandeep Modi
So you should reduce around 100 $120 per ton from this thing. Because if you have to compare from the historical past then you will have to use different data. But at this point of time if you have to compare like to like you may have to reduce 60 to $70 reduction.
Unidentified Participant
Would be so by product. Realize realization there would have been a. Similar reduction in cop.
Sandeep Modi
Yeah, absolutely. And that’s why I have said that on a constant basis you should be assuming 950 to $1,000 cost of production.
Unidentified Participant
Understood. My second question is and maybe I missed it during the call so the cash profits were roughly 5000 crores in the quarter. How were they utilized in terms of spending?
Sandeep Modi
In terms of. So we. So we generated a free cash flow around 3,400 crore pre growth capex and out of which growth capex investor invested. So I’M not able to understand what do you mean by cash profit?
Unidentified Participant
No, if I just add the net profit plus depreciation right. That we are all 4740800 crores.
Sandeep Modi
Yeah. So yeah that comes to. Yeah. 4700 out of which 800 crore has been invested in the sustaining capex and 500 crore has been invested in the growth capex.
Unidentified Participant
1300 crores was invested out of the 48 so there was a 3400 crore net cash accretion.
Sandeep Modi
Absolutely
Unidentified Participant
Understood. Got it. Thank you very much sir.
Operator
Thank you. Before we take the next question would like to remind participants to ask a question Please press star and one on your phone. Next question is from the line of Sumangal Nivatia from Kotak Securities. Please go ahead.
Sumangal Nevatia
Yeah, thank you for the chance. So first question is could you share what were the grades for this quarter versus last year or some previous comparison?
Sandeep Modi
So this quarter the grade was 7.3% and last quarter similar period was 7.4%. So grade overall for the nine month it has been 7.4%.
Sumangal Nevatia
Okay sir, the silver production guidance of 685 plus minus 10 KD are we confident of achieving it? Because the ask rate suggest some 230 odd tons of requirement in the fourth quarter. So is the mining sequence and the sales what we are having a visibility now given one month we are into January mid. So are we confident of achieving it?
Arun Misra
So if you look at silver now since we have we are unable to utilize all the concentrate in our smelter for various reasons. So if you if you look at the silver number that way we have sold silver through concentrate up to 21 ton and we have produced silver MG451 tons so two together would be 470 tons 471472 tons. So that is the number if you look at that and in quarter four normally it is much better than quarter three and one of the highest in the year. So I think we will be close to our guidance that we give
Sandeep Modi
Also. Just want to add historically except the FY18 we have been running every year some of the lead mode certain months this year will be the full sink and lead mode. First year after 2018 in 2018 we delivered some 560 ton of the silver and this year whatever extra we are doing that is with the. This is think and lead mode. I think that is the operational efficiency and the recovery and other parameters has been been supporting us.
Sumangal Nevatia
Understood? Understood sir. And what would be the re mix in terms of overall power contribution for this quarter and your guidance was 27.
Sandeep Modi
So this quarter we would be. This quarter we were 20 for the RE power and we should be exiting at 25 as the wind bar capacity getting installed for the next year we should be between 35 to 40% and after the next year year 70%. That has been our stated statement earlier as well because the battery storage and wind is now getting commissioned.
Sumangal Nevatia
Okay. And sir, in terms of cost saving from say 25% this year to 75% in FY28. So incrementally 50%. What would be the cost saving in say. Rupee. Rupee crore or something or dollar per ton.
Sandeep Modi
So 20 to 25 dollar per ton saving will be through RE power. But there will be like as you go deeper to the mines and great differentiation also happen. So as I said that’s why we should be assuming between 950 to $1,000 per ton of the cost. But if you ask only from the RE power point of view we should be saving annually with this incremental almost 250 to 300 crore annually.
Sumangal Nevatia
Understood. And just one last question on a hedging strategy. You said 10 to 20%. When did we, I mean have we been doing since last two, three years hedging? I thought it is more of a this year phenomena.
Sandeep Modi
No, if you see the last three years we have been doing before that year enough before that year also we did it and this has been consistently 10 to 20% of the hedging silver. We started hedging in the FY25 as well.
Sumangal Nevatia
Okay. So this is the second year. Okay. And going forward.
Sandeep Modi
Yeah. Think it’s the third year silver. It’s the second year.
Sumangal Nevatia
Understood. And going forward this is the range we should expect. Right? I mean irrespective of whatever our view on commodity is we would be maintaining 80 spot and 15 to 10 to 20%. 20%.
Sandeep Modi
We so wanted to give again the perspective whenever. When we start the business planning internally from the board approval and the consensus with published by 2550 Bankers. If we feel if we see that prices trading and which we are getting in the market are better than business plan and the consensus. That’s how we did the hedging and that’s how we will be continuing. Because the remaining 80 to 90% volume will always be remain available for the market to be anything but more from the our certain margin lock in.
This is the right strategy. We believe. And this has been being done across the globe by the large peers.
Sumangal Nevatia
Understood. And if I may squeeze in one more. Sorry, can I ask one more question?
Sandeep Modi
Yeah, yeah, please go ahead. Please go ahead.
Sumangal Nevatia
Yeah, no, I had a question on Freecash, but it is covered. All right, thank you so much. Thank you.
Operator
Thank you. Next question is from the line of Tarang Agarwal from Old Bridge. Please go ahead.
Unidentified Participant
Hi, a couple of questions. One, you know, while the zinc cost of production has been the lowest in the last five quarters but if I look at overall cost of production, that’s actually inched up. I think in the opening comment, Mr. Mishna alluded to some mine development cost being higher. So say on a year on year basis, what would that number be? Incremental mind development cost?
Sandeep Modi
No, I think he was saying it’s getting offsetted with the mind development rate. Because there has been certain positive and there is certain as the mines go deeper, if you see that will be always such kind of scenario to mind development. YOY large scale of 14 kilometer this. Year, 15 kilometers
Arun Misra
Additional mine development. So
Sandeep Modi
That impact will come then the inflation of the mine development rate that also comes up. But that is. That is the operational excellence company continue to do. If there is a one way cost is increasing, the other way is to decrease. So that is a major cost reduction is happening in the power cost where due to three things. This year we had a 50. This quarter we had 58% domestic coal utility utilizations. Second, our imported coal prices were lower and third, ARI power share. So all these things put together offsetting the power cost and our volume was also yoy better.
That also gives the benefit of the better cost. So these gets offset and then remaining comes to the what we were saying by products and other things.
Unidentified Participant
Sir, if I look at it on a year on year basis, I mean employee costs, power and fuel, all of them are low are lower on a per ton basis. Right. But mining royalties obviously increased because our realizations have inched up materially. But there’s this line item which is other expenses including manufacturing that metric has inched up by almost $150 on a year on year basis. So I was just curious what are the factors that have contributed to this growth? When I’m talking on the delta, I’m talking on a per ton basis.
Sandeep Modi
So in other expenses you will see one of the key reason is the revenue. Since our brand fee is linked with the turnover. So in case the turnover is increasing, y o y it will be also increasing. So It’s a remain 3% of the turnover but remains in terms of absolute value, it will increase.
Unidentified Participant
Okay. And sir, you know you spoke of hedging so in Q3, what did that get? Did I get it right? It almost 55kt of silver was hedged.
Sandeep Modi
Q3 is a 60. Q350. Viber metric term was hezed which got squared off. Q4 is a 68.
Unidentified Participant
So. So 55 was hedged at what price, sir?
Sandeep Modi
37.
Unidentified Participant
Okay. But sir, against our general policy of 10 to 20%. 55 is almost 30% of our output.
Sandeep Modi
You have to see the.
Unidentified Participant
So so when you say 68 at 39 it’s cumulatively for FY26, is it?
Sandeep Modi
No, no. It’s a separately when I say the 10 to 20% of the hazing. So silver was hazed for 20% of the total volume. That has to be seen on annual volume.
Unidentified Participant
Okay. So technically if you are looking at about 680 tons so to say in FY26 between Q4 and Q3 almost 125 tons is done, right? Yes. So so basically are we suggesting that most of the hedging actually happened only in Q3 and Q4? Is that the right way to look at it?
Sandeep Modi
Hedging was done in the month of June, July for the quarters of quarter three and quarter four.
Unidentified Participant
Got it. Got it. And so last question, sir. What is the net debt on books as on 31st December
Sandeep Modi
It’s the net. Cash at 329 crore.
Unidentified Participant
Okay, perfect. Okay. Thank you.
Operator
Thank you. Next question is from the line of Pallav Agarwal from antique stockbroking. Please go ahead.
Pallav Agarwal
Yeah. Good evening and thank you for the opportunity. So just want to update on the tailings project. You know what sort of progress have you made on that?
Arun Misra
Tailings groundwork has started which is ground clearing, setting it up for construction. So that has started. Also we have to go through the various regulatory clearances. So basic workers.
Pallav Agarwal
Sure, sir. Also on the 2X, you know, expansion. So on the. Specifically on the lead and silver portions. How’s the progress been over there?
Arun Misra
So we are not doing 2F in form of lead and silver. It’s all. Our mine is zinc and lead mine. And both are, you know they are not separately lead mine and separately zinc mine. So we will be expanding. If you look at it expansion wise, expansion at RD mine and expansion at Dower are the two big components. They will add maybe some amount of silver. But the fact that the volume will double automatically the silver quantity. Even if we say take even today’s worst silver ppm. If I make it 650 then also we will have 1300 tons.
And if we say at this current Position we can prepare make up to 700 tons. Then we are looking at a 1400 tons of silver just because of the volume impact.
Pallav Agarwal
So more on the lead smelting part. So I think the silver would be a byproduct from there. So you know, I think. Yeah, yeah,
Arun Misra
Absolutely. So automatically the silver, our lead current 200kt production will go up to say 400kt production. So automatically the silver also our Pantanagar refinery is already capable of 800 tons of silver. Maybe we’ll have two expanded by another 600, 700 tons there. Or if we can put up a 600 ton silver facility in our existing locations.
Pallav Agarwal
Sure. So okay. So along with the smelting, even though the silver output should work. Of
Arun Misra
Course. Of course.
Pallav Agarwal
Right? Yeah. Okay. Thank you.
Operator
Thank you. Next question is from the line of Vikas Singh from ICIC Securities. Please go ahead.
Unidentified Participant
Good afternoon sir and thank you for the opportunity. So just wanted to understand our strategy here. On one hand we are selling lead and silver concentrate in the market. And at the same time you yourself said that at least 1/4 you usually run at a lead heavy pyro mode which is not happening this time. So they didn’t understand why we are doing so or in this something to do with weight.
Arun Misra
We are currently running the pyro in the lead plus zinc mode because we are having a very good zinc price as well. So if I just go into lead mode, we do that when the zinc prices are say 2000 or 20 $200 a ton and the silver prices are around $30 a tri ounce, then it makes a heavy sense not to produce so much of zinc but produce more of silver. The lead quantity remains same in both the cases. So that right now with the zinc prices there is no reason that why we should convert everything to lead mode only.
Second, what have we sold? The lead concentrate produced by the RD mill which was in the beginning, in the commissioning stage they were lead concentrate but the concentrate grade was poor. So it is better that our smelter, as it is we are lacking in capacity. Why would we overburden that smelter with this poor grade of concentrate? So that is the choice we made
Unidentified Participant
Notice. So by that account means even at the current silver prices the butter is more towards the lead production higher.
Arun Misra
That means we’ll produce more drink at the same time the due amount of silver.
Unidentified Participant
Okay, so just, just let me rephrase this way. So given the current zinc prices for next year also the most likelihood of. Future we will continue
Arun Misra
In the lead plus zinc mode. Only because we were we will have a surplus MIC at the end of the year zinc mic. And we want to run through it in the month of April, May. And if the zinc prices are also remain stable at that 32,33 then why should we, you know, not produce zinc. We will keep on producing zinc and try to see what debottlenecking of lead production facility we can do so that we can increase silver production. That we are working on this business plan. And I think once the board approves, then we will let you know what is that incremental facility in lead production we will do.
Sandeep Modi
And another thing to add that it is not like by choice we can do because zinc and lead is a joint product which is get produced as part of the mining. So if I run the zinc LED mode then then lead concentrate will get piled up. If the I run on the lead mode, the zinc concentrate will get piled up and we are not in the business selling the concentrate. It was only an opportunity which we got during this time where the lead silver prices were also better. But strategically and technically and operationally we would like to run in the zinc and lead mode only,
Unidentified Participant
Not at. And so just one more thing. Any update on the femur?
Arun Misra
FEMOR is operating. So we had some trouble as such a Chinese on all that. But on our engineers have got trained. And I think this year in nine months we have added about three tons of additional silver only through running the fumer. And
Sandeep Modi
So in case of humor, we have been running at a 60 capacity.
Arun Misra
Eight tons we have. We have added in nine months. And we will continue at least now shutdowns are over. Then few months will operate far better in Q4 as well.
Unidentified Participant
Notice that’s all from my side. Thank you.
Operator
Thank you. We’ll take a next question from the line of Ashish Kejriwal from Novama Wealth Management. Please go ahead.
Ashish Kejriwal
Yeah, hi. Thanks. Good evening everyone and many congratulations for the results. So my question is in the world, what volume guidance you are not changing your guidance. Assuming that fourth quarter normally is a seasonally good quarter and we normally see higher volume. But at the same time, if you look at we are not changing the lead zinc mode and obviously then how. I don’t know how silver volumes will be higher as more than 200,000 tons. Even if I am assuming lower end of the guidance as well as If I add 20,000 of lead concentrate which you sold indirectly.
If I am putting that also. So from 158 to more than 200,000 tons without changing the zinc lead Mode are we seeing any higher ppm in this quarter or how do we try to justify that? And secondly, even in terms of refined metal asking rate is much higher than what we have seen earlier. So what changes which we are making which will make us comfortable for this volume. So
Arun Misra
One of the debottlenecking which is pushing in higher current in the electrovening processes at both Daribar as well as Chanderia, they have been completed and they are stabilized working absolutely to the capacity which have got a capability of adding 25,000 tonnes per annum capacity. So we will use that at the same time of course fourth quarter always better grades in terms of which selectively we will ensure that we have to get more silver. So all and the silver recovery processes in the mills we have already commissioned a graphite pre float process in Abucha which was not there in quarter two or first part of quarter three.
So those initiatives are in place. At the same time we are very confident of quarter four being exceptional numbers and hence we’ll be meeting the guidance or maybe close to the guidance on matters of silver.
Ashish Kejriwal
Okay. Okay. And secondly in terms of hedging for next year as our policy of 10 to 20% of the volume we normally hedge and as far as even if we assume 720kt for next year we have hedged around 8% of the silver volume now. So and now silver price is $93 per ounce. So do you think that we are going to hedge more in next one or two months so that you know at least FY27 we will be comfortable with those numbers.
Sandeep Modi
So Sandeep here. So it will remain dynamic. So we also watching the market, we also have the in house experts who will be keep advising us. So depending upon that we will be heading. It’s not like when we hedge we hail on the day one complete quantity. It’s like a
Ashish Kejriwal
Staggered
Sandeep Modi
Manner stage. So whatever quantity I have said this is for, mostly for April to October. So remaining five months we’ll see when we move near to February and March.
Ashish Kejriwal
So what’s your view sir, on terms of silver as well as zinc price, do you think that these prices may sustain for a while also it may increase or do you think that it’s the right price to hedge little more?
Sandeep Modi
So as I say that hedging is not for the purpose of playing with the prices. It is more about having the locking in margin when it is a more than business plan or consensus prices. That’s how we have been doing. So I just want to make it clear because it’s being heard that hedging is being done at the right price. No, there is no right price. It’s a price is only where we believe that as a management that it’s a margin should be logged in at certain level of the business plan or consensus prices.
So especially on the silver I unfortunately don’t have any price skews given the volatility which is going to the market. So many geopolitical tensions. One statement makes the prices down, the prices up. I think it’s very, very difficult to comment upon the silver prices Jing. We believe that given the maybe a bit of the surplus may be in the calendar year 26 but still I think the prices should be in the range which is going on 33,000 to 3,200.
Ashish Kejriwal
Sure. Thank you so much and all the best.
Sandeep Modi
Thank you.
Operator
Thank you ladies and gentlemen. We’ll take that as the last question for today. I now hand the conference over to Ms. Raksha Jain for closing comments. Over to you, ma’. Am.
Raksha Jain
Thank you operator. Thank you everyone for joining us today on this call. If there are any follow up questions or any clarifications required, please feel free to reach out to the embassy relations team. Thank you.
Operator
Thank you on behalf of Hindustan Singh. That concludes this conference. Thank you for joining us and you may now disconnect your lines.