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<keyword id="28423" type="General" weightage="50" keywordseo="vedanta" source="Orion">Vedanta</keyword> group firm <keyword id="332980" type="General" weightage="50" keywordseo="hindustan-zinc-ltd" source="Orion">Hindustan Zinc Ltd</keyword> on Wednesday said its board has approved a second interim <keyword id="56600" type="General" weightage="20" keywordseo="dividend" source="Orion">dividend</keyword> of Rs 6 per equity share for FY24, amounting to Rs 2,535.19 crore. "The board of directors of the company through resolution passed by circulation on Wednesday, December 6, 2023 have approved 2nd interim dividend of Rs 6 per equity share i.e. 300 per cent on face value of Rs 2 per share for the Financial Year 2023-24 amounting to Rs 2,535.19 crores," the company said in a stock exchange filing. The interim dividend will be paid within stipulated timelines, it said. The company had announced its first interim dividend of Rs 7 per share in July this year. <keyword id="720166" type="General" weightage="50" keywordseo="billionaire-anil-agarwal" source="Orion">Billionaire Anil Agarwal</keyword> is considering a major restructuring of his profitable zinc unit <keyword id="115997" type="General" weightage="100" keywordseo="hindustan-zinc" source="Orion">Hindustan Zinc</keyword> Ltd to help the Vedanta group reduce its debt. Hindustan Zinc Ltd had earlier said that it could create separate legal entities for its zinc and lead, silver, and recycling businesses to help capitalise on "distinct market positions" and attract investors. A committee of directors will evaluate the options and advise the board, along with external advisers. Hindustan Zinc is world's second largest integrated zinc producer and fifth largest silver producer. The company holds about 80 per cent of the growing zinc market in the country, having its headquarters at <keyword id="42774" type="General" weightage="50" keywordseo="udaipur" source="Orion">Udaipur</keyword> and zinc, lead mines and smelting complexes spread across Rajasthan. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/news/oneplus-announced-new-flagship-smartphone-oneplus-12-with-up-to-24gb-ram/articleshow/105756057.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/oneplus-announced-new-flagship-smartphone-oneplus-12-with-up-to-24gb-ram/articleshow/105756057.cms" target="_blank">OnePlus 12 debuts with bigger battery, up to 24GB RAM and more</a><a href="https://www.businessinsider.in/sports/webstories/indias-tour-of-south-africa-squads-schedule-where-to-watch-and-more/slidelist/105755174.cms" target="_blank"></a> <a href="https://www.businessinsider.in/sports/webstories/indias-tour-of-south-africa-squads-schedule-where-to-watch-and-more/slidelist/105755174.cms" target="_blank">India’s tour of South Africa – Squads, schedule, where to watch and more</a> <a href="https://www.businessinsider.in/india/news/noida-woman-scammed-11-lakh-in-digital-arrest-scam-everything-you-need-to-know/articleshow/105727970.cms">Noida woman scammed ₹11 lakh in digital arrest scam – everything you need to know</a>

Hindustan Zinc board approves dividend of Rs 2,535.19 crore

The year 2013 witnessed a great deal of volatility, with the <keyword id="6354813" type="COMPANY" weightage="40" keywordseo="nifty">Nifty</keyword> and the <keyword id="6484188" type="CITY" weightage="40" keywordseo="Sensex">Sensex</keyword> surging to new highs. Nevertheless, three out of five Nifty 50 <keyword id="6354298" type="ORGANIZATION" weightage="40" keywordseo="stocks">stocks</keyword> remained laggards, including a number of high-profile companies. 
 This year might have been forgettable for them, but these heavyweights are likely to do better in 2014, not just because of their vast potential but also due to favourable changes in the <keyword id="34412" type="ORGANIZATION" weightage="40" keywordseo="economy">economy</keyword>. ET Intelligence Group lists the companies that are likely to lead the Nifty rally in 2014 and why. 
 
<keyword id="6355199" type="CITY" weightage="40" keywordseo="Reliance-Industries">Reliance Industries</keyword> 
 
After underperforming the Nifty for five consecutive years, Reliance Industries has barely matched the index’s performance in 2013 so far, but 2014 is likely to be better. 
 
Reliance has embarked on a high capital expenditure programme, investing Rs 1,50,000 crore in three years in expanding petrochemical and polymer capacities, improving efficiencies at its refineries and increasing its dwindling gas output. 
 
 
 
Thus, FY13-FY16 is likely to be a phase of high earnings growth for the company, supporting stock outperformance. There are some risks, though. The company is fighting against penalties proposed by the petroleum ministry, while the outlook for the refining industry is clouded, with margins likely to come under pressure in 2014. Nevertheless, the company’s strong balance sheet should ensure a robust performance for its shares once the risks subside. 
 
Sesa Sterlite 
 
The government has endorsed the sale of residual stakes in its two group companies – Hindustan Zinc and Balco – through auction. This will allow Sesa Sterlite, which already holds more than 63% of HZL, to buy 25-100% of the government stake. Following this, HZL would be either merged with Sesa Sterlite or delisted. This would give Sesa Sterlite access to more than Rs 20,000 in cash with HZL and put the company in a position to bring down its debt. 
 
Also, the overall volumes of the companies across businesses – iron, copper, zinc, and oil and gas – are likely to pick up in 2014. The aluminium business could face some pressure due to falling prices. Growth in volumes and strengthening of the balance sheet will lead to re-rating of the stock, which is currently trading at a significant discount to its global peers BHP and Rio Tinto. FY15 EV/EBIDTA for Sesa Sterlite is 4.9, while it’s 6.2 and 6.6 for BHP and Rio, respectively. 
 
<keyword id="6653" type="CITY" weightage="40" keywordseo="ICICI-bank">ICICI Bank</keyword> 
 
Focus on the retail segment, a large branch network and steady loan growth may lead to consistent profit growth in the next few quarters. The bank has posted a 20% y-o-y growth in net profit in the last 12 quarters. Current and <keyword id="25450" type="UNKNOWN" weightage="40" keywordseo="savings">savings</keyword> accounts (CASA) as a percentage of total deposits improved to 43.3% in the September quarter as against 39% in the June quarter. This is among the highest among the private sector banks. 
 
Gross NPAs as of the September quarter stood at 3.08%, which is reasonable considering the macro environment. At current market prices, the stock is trading at a price-to-book value of 1.8. This is lower than peers such as HDFC Bank and Kotak Bank, which are trading at 4.5 and 3.5. Over the last few years, the stock was trading at a discount to its peers due to higher exposure to stressed assets. However, sustained profit growth in next few quarters may lead to a lower valuation gap. 
 
Ultratech Cement 
 
UltraTech Cement, being the largest company in the sector with a pan-India presence, stands to gain from the expected improvement in construction in 2014. With the acquisition of JP Associates’ Gujarat plant this year, the company’s cement capacity stands at 63 million tonnes, almost 16.8% of total domestic capacity. 
 
UltraTech Cement has been selectively expanding its capacity, which has strong long-term benefits. Cement prices are currently under pressure. In the September quarter, all-India cement prices traded at Rs 299 per 50-kg bag, up 2% from the year earlier. Once demand improves next year with the clearing of infrastructure projects, UltraTech would be one of the few large cement companies to gain. In the coming year, analysts expect cement demand to grow at 7-8%. This should improve earnings at UltraTech, which also has a light balance sheet with a debt-to-equity ratio of less than 1. 
 
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<keyword id="45475" type="CITY" weightage="40" keywordseo="Larsen-Toubro">Larsen &amp; Toubro</keyword> 
 
 
 
If there is one company that has succeeded relatively well in defying the slump in the engineering and capital goods sectors over the past few quarters, it is Larsen &amp; Toubro. The company’s increasing focus on internationalisation has helped it partly offset the slump in the domestic economy. The company had an order book of Rs 1.76 lakh crore at the end of the September quarter or close to three years of revenue. 
 
The ratio of international to domestic orders moved up from 10:90 in 
FY13 to 15:85 at the end of September. This puts pressure on operating profit margin, which at 10.2% for the trailing 12 months was 87 bps below the comparable period. An increase in domestic investment activity could ease out some stress on the margins going forward. In the event of a pick up in the investment economy in second half of 2014, it is likely to be one of the biggest beneficiaries and that will invariably boost its share price. 
 
PowerGrid 
 
PowerGrid has underperformed the broader index due to the overhang of the dilution through the recent follow-on public offer. However, PowerGrid may now not need any further equity for at least next three to four years. Under the 12th Five-Year Plan, the company has a capex target of Rs 1.1 lakh crore. 
 
In the past, the company has consistently met its execution target, which led to a compounded annual growth rate of 24% in net profit in the last five years. Given the track record on execution and the healthy capex target, profit growth may continue to remain healthy in the future. Going ahead, with concerns over equity dilution subsiding, the stock may be driven by fundamentals. 
 
Cipla 
 
Cipla, one of India’s biggest drug makers, has been through a transition phase in 2013. This has included the induction of new senior managers, changes in <keyword id="383688" type="UNKNOWN" weightage="40" keywordseo="business-strategy">business strategy</keyword> and the restructuring of various business segments. The company is now setting up front ends in the developed markets of the US and Europe with an intention to launch its own products there. It is also investing in R&amp;D to build a pipeline of products for launch. 
 
This increased initial investment has squeezed margins in recent quarters in the expectation of more sustainable growth in the future. As product approvals pick up and products are launched, the company is likely to see the fruits of this strategy in 2014. It’s likely to emerge as an outperformer in its sector by the second half of 2014.

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Hindustan Zinc board approves dividend of Rs 2,535.19 crore

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