Metal stocks surged sharply on Wednesday, 13 May, tracking a steep rise in gold, silver, and base metal prices following India's decision to raise import duties on precious metals. According to PL Capital, Hindustan Zinc led the rally, surging nearly 5%, while Vedanta gained over 1.5%. Hindustan Copper rose more than 3%, National Aluminium Company and Hindalco each added over 1.5%. The Nifty Metal index rose 1.3%, with every constituent trading in positive territory as commodity prices lifted sector sentiment.
The government increased the import duty on gold and silver from 6% to 15%, with the revised duty rates coming into effect from May 13, 2026. As reported by PL Capital, the revised structure imposes a 10% basic customs duty along with a 5% Agriculture Infrastructure and Development Cess (AIDC) on gold and silver imports. The measures are aimed at curbing excessive bullion imports and reducing pressure on India's foreign exchange reserves amid rising global uncertainties. The revised duties apply to gold, silver, platinum, jewellery findings, and industrial imports linked to precious metals, with the government also raising import duties on gold imported from the United Arab Emirates under the fixed-quantity quota mechanism.
Bullion prices witnessed sharp gains as buying intensified through the session. According to PL Capital, MCX gold climbed ₹9,206, or 6%, to ₹1,62,648 per 10 grams, while MCX silver jumped ₹16,743, or 6%, to ₹2,95,805 per kilogram. Both contracts hit their 6% upper circuits as the revised duty structure is expected to raise the landed cost of imported bullion. The policy aims to ease pressure on India's foreign exchange reserves and the rupee while moderating bullion demand.
Hindustan Zinc, a Vedanta Group company, is the world's largest integrated zinc producer and is among the top 10 silver producers globally. According to Business Standard, the company supplies to more than 40 countries and holds a market share of about 74% of the primary zinc market in India. The company is the largest silver producer in the country with an annual production capacity of approximately 800 tonnes.
In its March 2026 quarter (Q4FY26) earnings conference call, Hindustan Zinc highlighted strong silver market fundamentals. As reported by Business Standard, the company stated that silver continues to stand out, maintaining strong momentum supported by robust industrial demand, particularly from solar and electronics, alongside continued investor interest. The management expressed confidence in sustaining strong performance with expected mined metal production of 1,150 KTPA, plus or minus 10 KT, and refined metal production of 1,100 KTPA, plus or minus 10 KT, with an expected refined silver production of 680 tons, plus or minus 10 tons.
