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Suzlon Energy up 3% in trade; Motilal Oswal initiates coverage with 'Buy'

The domestic brokerage gave the target of Rs 70 per share as the company is a global leader in wind energy with an installed capacity of 20.9 GW across 17 countries

Suzlon

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SI Reporter Mumbai

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Suzlon Energy shares gained 2.6 per cent in trade on Tuesday, March 25, 2025, logging an intraday high at ₹59.45 per share on BSE. The stock was in demand after Motilal Oswal initiated coverage on the stock with a 'Buy' call. 
 
However, around 10:37 AM, Suzlon Energy share price pared some gains and was up 0.28 per cent at ₹58.08 per share on BSE. In comparison, the BSE Sensex was up 0.52 per cent at 78,389.27. The market capitalisation of the company stood at ₹79,351.72 crore. The 52-week high of the stock was at ₹86.04 per share and the 52-week low was at ₹36.8 per share.
 
 
The domestic brokerage gave the target of Rs 70 per share as the company is a global leader in wind energy with an installed capacity of 20.9 GW across 17 countries.
 
Further, Suzlon Energy projects India’s new wind energy installations to reach 4GW in FY25, 6GW in FY26, and 7-8GW annually from FY27 onward. This opportunity positions the company's Engineering, Procurement, and Construction (EPC) and Order Management System (OMS) businesses for strong growth, according to Motilal Oswal.
 
On the financial front, Suzlon Energy's net debt-to-Ebitda ratio has moved from 6.6x in FY22 to a net cash position in FY24. The brokerage expects the net cash position to rise further by FY27 given limited capex needs in the near term (₹350-400 crore p.a. FY25 to FY27). Operating cash flows too are expected to rise strongly as the company executes its order book. 
 
On the valuation front, Suzlon Energy is reasonably priced, believes Motilal Oswal given an estimated earnings per share (EPS) compound annual growth rate (CAGR) of 63 per cent over FY24-27.
 
This surpasses domestic capital goods peers ABB India (23 per cent), Siemens (20 per cent), Thermax (17 per cent), and CG Power (26 per cent) and global peers such as SANY (26 per cent). 
 
The key risks for the company are rising competition from Chinese and European players as wind installations pick up; potential pressure on realizations/ margins for wind turbine generators (WTGs); Dependency on ISTS waiver for project economics; Technological changes leading to product obsolescence; Delays in project execution leading to slower-than-expected execution of order book and volatility in raw material prices, operational and overhead costs.
 
In the past one year, Suzlon Energy shares have gained 56 per cent against Sensex's rise of 7.6 per cent. 

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First Published: Mar 25 2025 | 10:56 AM IST

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