With a market valuation of more than Rs 78,000 crore, Suzlon Energy’s shares rose 5%, stuck in the upper circuit limit, reaching Rs 57.82 a share, new 52-week highs.
Tuesday saw Suzlon Energy shares reach their upper circuit limit and rise to a new 52-week high following the company’s announcement of impressive Q1 FY25 results for the June 2024 quarter. The player in renewable energy released its quarterly results after market hours on Monday.
Anand Rathi Shares & Stock Brokers, a domestic brokerage firm, is still upbeat about Suzlon Energy because it believes the business is well-positioned and ready for further chances. After a recent visit to the plant, the domestic brokerage company raised its target price and maintained its ‘buy’ rating on the shares.
“We went to the Suzlon Daman plant, which makes wind turbine nacelles. Beginning operations in 2004, the plant produced more than 60% of the more than 20GW of turbines supplied worldwide, according to Anand Rathi. According to the report, India’s installed wind capacity would reach 8–9 GW by FY27.
More than 60% of the more than 20GW wind turbines delivered internationally over the last 20 years have come from the Daman factory. The plant’s turbine capacity increased to 3.1MW with a rated capacity of 2.7GW.
In the near future, Suzlon intends to increase its Daman capacity in order to take advantage of the growing demand and gradually reopen the similar-sized Pondicherry in accordance with utilization and demand projections. According to the brokerage report, it intends to automate its factory in FY26 in order to improve safety standards and reduce turnaround times.
Suzlon Energy Ltd.’s shares rose 3% on Monday from their day’s low of Rs. 53.50 to Rs. 55.14, bringing its entire market valuation close to Rs. 75,000 crore. On Friday during the previous trading session, the stock had finished at Rs 54.54.
“We recognize that the company is positioned to benefit from growing utility and C&I segment demand. With a raised target price of Rs 58 from Rs 55, it stated, “We factor in 1.5 and 2.2GW deliveries for FY25 and FY26, and reiterate ‘buy’ rating, at 35 times FY26e PE.” Key concerns are viewed as unfavorable government policies, a slower-than-anticipated recovery in WTGs, and more intense competition.
Anand Rathi Shares & Stock Brokers anticipates Suzlon Energy will perform well in the June 2024 quarter due to an increase in wind turbine deliveries, which will boost earnings with the help of operating leverage. Suzlon Energy is still one of Anand Rathi’s top recommendations.
Suzlon is expected to report revenue of Rs 2,431.6 crore, up 80% YoY and 10.7% QoQ, according to the brokerage company. EBITDA margins might be 16.8%, up from 16.3% in the same quarter last year. With an adjusted net profit of Rs 325.2 crore, it has increased by 14.6% QoQ and 222.5% YoY.
