Q4FY26 delivered all-time high EBITDA INR7,747cr and net cash INR5,594cr.

Would it be possible for you to give me what the hedge quantity across zinc and silver would be for both Q1FY27 and the whole year of FY27?

For Q1, zinc is hedged at 20 KT spread between April to June at an average price of $3,100, and silver is hedged 25 tons at an average price of $57. For the full year FY27, 71 KT is hedged at an average price of $3,225 per ton and silver is hedged at 59 tons at an average price of $60 per troy ounce.

The presentation states that we plan to take silver capacities up to 830 tons by 2029, but this year's run rate has been roughly 622 to 630. How should we see the run rate from here onwards?

This will come along with the expansion of the 250 KT smelter. When that 250 KTPA smelter gets added, total will be about 1.35 to 1.4 million ton of metal, and MIC would be about 1.5 to 1.55 million ton. We are also commissioning the LGLC circuit which will produce additional silver, plus the new smelter with its own fumer. By that time, some tailings recycling will also come back. Altogether it will be crossing 800 tons of silver by that time.

During Q4 we did around 176 tons for silver. Would it be safe to assume we can maintain this run rate going ahead in Q1, Q2 and for the remaining part of FY27?

Our guidance is 680 tons for the entire year. We'll follow the similar pattern. If you consider last year we did the MIC sale in which 37 tons of silver equivalent was there, adding that to 627 gets us to 664. If lead metal prices fall while zinc prices are up, we'll tilt production towards more zinc and less lead, selling the lead MIC surplus while recovering silver through the lead MIC sale route.

There's a 35% sequential jump in other expenses. What were the key reasons behind the same?

HZL has set up various ancillary businesses with third parties where we provide them smelter residue - the PF cake containing zinc and cadmium - and then purchase back finished goods or WIP used in other smelting or mining processes. The sale is recorded as other operating income and the purchase as other expenditure. The amount is around INR600 crores both sides. This trend will increase to maybe INR1,200 crores to INR1,500 crores annually on both sides.

Q4 cost was pretty low at $900 per ton but for the full year guidance is about $975 to $1,000. Will there be such a steep increase in Q1 or will that be more towards the second half?

The Q4 cost had significant benefit from mining grade of 7.9% versus full year average of around 7.5%, and 10 bps of mining grade impacts $7 in cost. Q1 historically we have been around 7.3% to 7.4%. The current geopolitical environment also affects input costs - diesel, propane gas, chemical, explosive. We have factored those. $975 to $1,000 is good enough and we should be able to do much below that as the situation improves.

Have we seen any impact of the shortage of natural gas? Has it impacted our production or led to higher costs in Q4?

It is a marginally higher cost in Q4, maybe around $11 per ton, but on the production point of view, no impact.

Could you give us the RE proportion of renewable energy consumption in FY26 and how much that will increase in FY27?

FY26 we closed for the full year around 18% renewable energy and for the full year in FY27, we should be between 30% to 35%.

When we move from 1,048 KT metal to 1,100 KT metal, that means more acid and residues. Can you guide how much per ton could be sustainable?

When we move from 1,048 KT metal to 1,100 KT metal, that means much more acid and more residues will be available. This effort is sustainable and volumes are only increasing going forward. This other income going up every year - unless prices crash, we see a good prospect of sustaining this kind of an earning. The quantities of material will keep on increasing along with the increase in mined metal and refined metal.

In the next phase of expansion, you mentioned a second phase in the next six months. Where are we on that or will you complete the first phase before starting the second?

We are absolutely on the job. Earlier we were thinking of making two or three different smelters in different locations. Then we decided instead to bring everything together in one place. Designers have confirmed that in one location about 600-700 KTPA smelter can be put - meaning a 1 million ton smelter in one location. That design has been finalized. Commercial process is ongoing. In another one month we should be able to place the order. Mills order will close between the first or second week of June.

Where is this 600-700 KT smelter being put - Rajasthan only?

Rajasthan, all Rajasthan only and we want to bring it in the similar distances because we don't want to carry concentrate on far distances.

With such a large capex plan, do we have comfort from the government on mine renewal beyond 2030?

We are comfortable because we have the first right of refusal. So in any case we - it's only a matter of how much premium we are ready to pay, but just by bidding people cannot take it away.

The silver production guidance looks a bit underwhelming. When can we see silver production spike up sharply to 700-725 tons? Should we expect production to remain in the 670-680 range for the next 2 years?

That can happen when the zinc prices fall to say $2,800 to $3,000 per ton. If zinc prices fall and silver remains at say $60 a troy ounce, it will make much more sense to produce more lead and silver. When we do that, then we'll surely see the numbers going up to 700 tons plus.

So as a company we cannot have higher silver prices and higher silver production simultaneously - they are mutually exclusive?

Our mines produce zinc-rich ore. With zinc LME at $3,100-$3,200 on average or picking up to $3,400, if you put the volumes, producing 30,000 tons of additional zinc brings more money than 30 tons additional silver.

The quarter has just started and you've declared FY27 dividend. What is the thought process? Also, has the brand fee/royalty fee been paid to the parent and were there any changes?

Last year also in June we declared the first interim dividend for FY26. Dividend is out of the earnings the company has - we have almost INR22,000 crores worth of retained earnings. The Board approved the first interim dividend of INR11, which is around INR4,300 crores. The brand license and strategic services fee has been paid as per the contract with Vedanta Limited. This year it is around INR1,300 crores, versus around INR1,100 crores in FY26.

When is the contract for the brand fee due for revision in terms of the percentage share?

The brand and royalty strategic services fees contract is valid till 2030. So in between there is no renewal. It's settled at the end of the year basis the annual accounts. For FY26, after the annual accounts audit, we have to pay INR100 crores pertaining to FY26.

FY26 dividend paid was some INR21 which is a decline versus last year despite profitability going up. Going forward with earnings tailwinds, should we expect a high payout to continue or is there a plan to pile on cash for capex?

The Board will continue to balance between paying dividend and investing for the expansion. Both will continue. When we declared the expansion, the question put to me was whether we'd be able to pay dividend. Our operations are proving we are able to maintain both - we can pay dividend as well as continue to invest in our assets.

Conceptually, cash flows will be used for dividend and growth and we would not be using debt for growth expansion, right?

Ideally no, but if there is a cash timeline mismatch or if the loan is much cheaper because of our balance sheet strength, we would take those calls. But primarily we are earning enough to fund our growth.

On the hedging strategy, broadly what should we expect? Are we continuously monitoring to increase or broadly 10% to 15% is the range and the rest left to market?

Our philosophy and policy has been to hedge between 10% to 20%. At this point of time, we are comfortable with the 10%. In the last quarter we have not hedged anything. We'll continue to be comfortable at 10%. We will not be going beyond 12 months for hedging. That is very sure.

With respect to our half a million ton fertilizer plant, can you share the volume expectation, ramp-up schedule, economics, and are we facing any RM challenges due to the ongoing conflict in Middle East?

We have not started operations at all. Another 3 months down the line we should be able to start our phosphoric acid plant, which is the first part. Then maybe 2026 end or early 2027, which is January, we will be able to start our DAP manufacturing plant. Right now there is no impact of rock phosphate and all that on our operations.

What was the revenue and the EBITDA from the lead concentrate sales during Q4?

Quarter 4 revenue from lead concentrate was around INR500 crores and EBITDA was around INR330 crores. EBITDA in Q3 was around INR250 crores and this time INR330 crores. It is a function of prices, USD-INR rate, TC/RC, and the quantity sold.

What was the hedging loss in the fourth quarter and for the full year?

I will not say it's a loss - it is a delta compared to the prevalent market prices. INR1,100 crores was the delta between the hedge price and the market price for Q4. The delta for the full year was INR1,500 crores.

Could you break down the FY26 capex into growth and maintenance?

Total capex was INR3,600 crores for the full year and growth capex was INR2,000 crores.

You've said you'll be planning to take the renewable energy share to 32% to 35%. Could you give us the timeline of how we are going to reach 70%?

70% is by FY28 as we committed earlier as part of our sustainability goals. By FY28 we'll be 70% round the clock. Every 2% renewable energy increase will have a $1 cost reduction. We still stand by it. If we move from 20% to 70%, we can see the further potential of $25 per ton cost reduction.

In terms of VAP share for FY26, could you share the number? And we are planning to take it to 50% - how much would realization improve in coming years?

We have around 24% VAP in FY26. In our zinc case, VAP commands only about $50 to $60 per ton over and above normal SHG zinc - not like aluminum VAP that commands $500 or $1,000 extra. It is more about supplying to customers in India and increasing domestic market share rather than profit increment.

When do we plan to come up with the final plan for the 600 KT expansion, with detailed capex and revenue potential?

We are working on the 1 million ton smelter, out of which 250 KT has already started within Rajasthan. By the end of Q1 we should be ready with the complete conceptual plan, layout, and engineering. We can then look at a July Board announcement after the full feasibility.

Silver prices in the last quarter touched even $100 plus. If we are hedging certain quantity every month, our average should have been higher than what you said. Have we stopped hedging after certain point realizing our mistake?

I don't think anybody could say it's a mistake. Every company has a policy of hedging the volume. We hedge 10% to 20% of annual volume accordingly. We stopped after the 10% hedging. After Q3 we have not hedged anything, not on account of anything else but more on account of the company's strategy. Given 58-59% EBITDA margin and silver being a by-product, it's not worthwhile to experiment and do the hedging beyond 10%.

At end of Q2 overall hedging for second half FY26 was almost 45-50% of total silver production. Is there any standardization to keep on hedging 10-15% on a rolling basis?

We are not following the policy of rolling 12 months. Our philosophy is that we will not go beyond 12 months. We'll relook at 10% to 20% whenever required. If at 10%, there is no compulsion to go up to 20%, and no compulsion to increase back to 10% if a position is unwound.

For FY26 the dividend given was INR10 and INR11 will count in FY27, is that correct? And is the minimum 30% of PAT dividend policy staying as of now regardless of capex?

Yes, INR10 was the dividend in FY26 and INR11 will count for FY27. Absolutely, the minimum 30% dividend policy stays.

We saw a decent increase in other operating income. What was that driven by? Was sulfuric acid sales part of it and how are sulfuric acid prices comparing to Q3?

Other operating income consists of two main items: sulfuric acid and by-products, scrap and residue. We have also entered into agreements with third parties for ancillary businesses where residue is processed and finished goods like cadmium are returned for our processes. Around INR600 crores for the whole year is part of both other operating income and other expenditure - an offsetting item. For the cost credit, scrap and residue sales were around INR1,000 crores and sulfuric acid was around INR1,400 crores for the whole year.

What was the coal sourcing mix and how are e-auction prices from Coal India tracking given the gas shortage?

For the whole year we were around 53% domestic coal and 18% renewable energy, so about 70% from these sources and 30% imported coal. For Q4, around 64% was domestic coal and 18% renewable, with the remainder imported. We have the linkage coal option with prices determined by Coal India. We have not seen any steep increase in domestic coal. There is a huge delta between imported and domestic coal of almost 40%. We source only very marginally through e-auction.