Hindustan Copper Falls on OFS Closure Amid Strong Earnings Outlook
Hindustan Copper's stock has taken a hit following the closure of its offer for sale (OFS) by the central government, priced at ₹514 apiece.
The total mop-up from the OFS would be around ₹3,000 crore, including the green-shoe option, while reducing the government's stake in the company by about 6% to 60.1%.
Despite the near-term pressure on the stock, strong investor participation in the OFS reflects Hindustan Copper's robust growth outlook.
The company's earnings have seen a marked improvement recently, thanks to the steep increase in copper prices and limited domestic production capacity.
Hindustan Copper is well-placed to benefit from the favourable copper cycle, driven by demand-supply imbalance and drawdown in LME inventory. The company targets 4.7 million tonnes of production in FY27 and aims to reach 12.2 million tonnes per annum on completion of its expansion projects by FY30.
The expansion plan is aided by sizeable ore reserves of 157 mt, with another 610 mt of resources that have the potential for commercial viability.