Hindustan Copper’s shares have been recovering steadily of late, surging 20% in 15 trading sessions, reaching ₹566 apiece, supported by a sustained rise in international copper prices.
Higher copper prices could provide further support to the company’s margins and revenue outlook, given its significant resource base, with the company holding around two-fifths of India’s copper ore reserves and resources.
Benchmark three-month LME copper reached a six-month high of $14,310 a metric ton in the previous session, building on a seven-week winning run amid concerns about availability on the London Metal Exchange, where inventories are at their lowest level since February.
The current supply crunch is being fueled by a surge in shipments to the U.S. in anticipation of a potential decision on import tariffs, while recent tightness in China has also drawn cargoes there. This has led stockpiles across the LME’s global warehousing network to shrink by almost half since mid-May.
President Donald Trump’s Commerce Department was due to make a recommendation on copper tariffs by the end of June, but no announcement has emerged from the White House. Meanwhile, copper has continued to flow to American ports, encouraged by higher U.S. prices.
Copper has gained more than 13% this year, boosted by optimism over growing demand from data centers and renewable energy.
Copper rally, favourable forex to lift Hindustan Copper’s earnings
Brokerage firm Anand Rathi expects Hindustan Copper to benefit from the recent rally in copper prices, supported by the company’s dollar-denominated LME-linked revenue and a weaker Indian rupee.
The brokerage said Hindustan Copper is preparing for its next phase of growth beyond its targeted 12.2 million tonnes of ore production.
The company has signed MoUs to revive copper mining operations in Sikkim and Jharkhand and plans to restart production at its Ghatsila Copper Project (GCP). These initiatives are likely to support its long-term growth trajectory while enhancing profitability, Anand Rathi said.
Global copper supply remains constrained by production cuts and operational disruptions in Chile, Indonesia, and the Democratic Republic of Congo (DRC), keeping the market structurally tight.
At the same time, Indian copper demand, currently estimated at around 1.55 million tonnes, is expected to double over the next decade, driven by power grid expansion, data centres, electric vehicles, renewable energy, and other new-age applications.
Considering strong demand from new-age sectors, the brokerage maintained its ‘buy’ rating on the stock, expecting it to reach ₹715 apiece.
(With inputs from Bloomberg)
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