Should you buy Hindustan Copper (HINDCOPPER) shares? The stock of Kolkata-headquartered Hindustan Copper, a copper ore miner under the administrative control of the Ministry of Mines, is a vertically integrated producer of the metal, which is utilised extensively in a host of industries including construction, electronics, transportation, and renewable energy. As of May 6, the Hindustan Copper stock has rewarded investors with a return of 158.6 per cent in six months and 253 per cent in a year, outshining gains of 24.2 per cent and 58.3 per cent in the Nifty50 and Nifty Metal indices, respectively. 

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Is it a good time to buy Hindustan Copper (HINDCOPPER) shares now? First things first, here are some of the key things to know about the PSU: 

Here are some of the key things to know about this midcap FMCG stock:

Hindustan Copper (HINDCOPPER) earnings

Hindustan Copper is yet to announce the date of release of its earnings report for the fiscal fourth quarter.

Q3 results: Hindustan Copper staged a weak performance for the October-December period, with a 21.3 per cent year-on-year fall in net profit to Rs 63 crore over a 28.4 per cent fall in revenue to Rs 399 crore.

Its quarterly earnings before interest, taxes, depreciation, and amortisation (EBITDA) contracted to Rs 106 crore from Rs 114 crore a year ago, according to a regulatory filing. 

How the Hindustan Copper stock has performed among its peers

Several analysts find the copper miner's stock expensive relative to the rest of the non-ferrous metal basket.

Stock Return (%) P/E (TTM)
YTD One year
Hindustan Copper 39.1 253.3 115.8
Hindustan Zinc 45.8 48.1 23.9
Vedanta 53.3 41.3 34.6
Gravita India -16.1 60.2 25.9
Bharat Wire Ropes -13.1 58.1 18.9
Ram Ratna Wires 23.2 88.7 32.5
Nile 48.9 126.3 11.9
Bhagyanagar India 7.2 118.5 7.1
Shalimar Wires Industries -14 90.6 17
Southern Magnesium and Chemicals 24.8 270.6 24.3
Bonlon Industries -18 -2.9 51.3
Poojawestern Metaliks 62.6 55.6 30.8
Nifty50 2.5 22 21.8
Nifty Metal 12 53.2 30.9

What is the P/E ratio? What does it tell?

The price-to-earnings ratio, also referred to as the P-E or P/E ratio, is a key financial metric used by analysts to evaluate a company's stock. It is calculated by dividing the current market price of a stock by its earnings per share. The P-E ratio on a trailing 12-month basis provides insight into how much investors are willing to pay for each unit of a company's earnings over the past year.

A high P-E ratio may indicate that a stock is overvalued, while a low ratio could suggest undervaluation. 

How is Hindustan Copper placed among its peers?

Analysts say Hindustan Copper is well placed in the area of copper production.

"It covers the entire process, from mining to conversion of saleable products, which provides it with an edge over many of its competitors. And with the advent of electric vehicles, the demand for copper is expected to surge by 1.7 million tonnes by 2027... India’s per capita consumption of copper is currently less than 1/5 of the global benchmark, clearly highlighting the future growth and opportunity for the company," Aamar Deo Singh, Head Advisory at Angel One, told Zeebiz.com.   

However, commodities are cyclical in nature and bouts of volatility are expected in their prices going forward, he adds. 

Hindustan Copper shares: Is it a good time to buy now? What analysts say 

*Investors should adopt a cautious approach at the current price levels, because the stock has already witnessed a significant price appreciation, and a fresh entry at current price levels might not be very favourable in terms of the risk reward. Hence, a wait-and-watch approach ideally should be looked at, and entry should be initiated on declines, though an SIP mode, to capitalise on the longer-term trends," said Angel One's Singh.   

Hindustan Copper (HINDCOPPER): Technical outlook

“Hindustan Copper has shown a robust uptrend over the past year, significantly outperforming the benchmark indices as well as the Nifty Metal gauge. The stock closed April with an impressive gain of nearly 39 per cent after establishing a base around the Rs 235 mark in the preceding month. A double-bottom pattern on the monthly charts contributed to the sharp surge in the stock price in April. This rise was also supported by the strength observed in the overall metals sector, particularly the increase in copper prices during the month,” Sugandha Sachdeva, Founder of SS WealthStreet, told Zeebiz.com.

Benchmark copper prices rose about 14 per cent in April boosted by higher demand, low inventories, and tight supplies.

Global copper prices surged about 14 per cent sequentially to $10,136 per tonne in April amid a rise in non-ferrous metals owing to supply-side constraints and Western sanctions on Russia, according to IDBI Capital Markets. 

The buildup of momentum came soon after copper crossed the $10,000 per tonne mark for the first time since 2022. 

A rise in benchmark copper rates is positive for companies such as Hindustan Copper, say analysts. 

Hindustan Copper shares headed towards Rs 720 apiece in two years? 

"Hindustan Copper seems poised for further upside, although some consolidation or profit-taking cannot be ruled out from current levels. The stock may face selling pressure towards the Rs 340-330 zone, from where it is expected to attract buying interest," said Sachdeva, adding: "Sentiments for the stock appear bullish and we anticipate the stock to target higher levels of Rs. 500 in the medium term and around Rs 720 in two years."

Growth levers for Hindustan Copper

Hindustan Copper's prospects are closely tied to copper, which has staged a spectacular rally gaining almost 20 per cent so far in 2024, says Singh of Angel One.

Here are some of the factors that have boosted copper rates:

  • Strong demand from China 
  • A dip in Chinese inventories due to smelter exports and pre-holiday stocking by downstream firms
  • Smelter maintenance, rising export volumes seen further impacting supplies after holidays
  • China is the world’s largest consumer of copper

Some profit-booking in the HINDCOPPER cannot be ruled out in the current scenario given its spectacular run, added Singh. 

Profile: What does Hindustan Copper do?

Hindustan Copper is a Category-1 Miniratna public sector enterprise under the administrative control of the Ministry of Mines. It is the only company in the country engaged in the mining of copper ore.

According to Hindustan Copper's mines and plants are spread across five operating units in Rajasthan, Madhya Pradesh, Jharkhand, Maharashtra and Gujarat:

  • Malanjkhand Copper Project (MCP) in Malanjkhand, Madhya Pradesh
  • Khetri Copper Complex (KCC) in Khetrinagar, Rajasthan
  • Indian Copper Complex (ICC) in Ghatsila, Jharkhand
  • Taloja Copper Project (TCP) in Taloja, Maharashtra
  • Gujarat Copper Project (GCP) in Jhagadia, Gujarat