Suzlon Share Hit Upper Circuit of 5% After Positive Rating by Morgan Stanley

Suzlon Energy share price surged by 5% to hit the upper circuit limit of ₹62.37 in early trading on November 19. This marks the third consecutive day of gains for the company, following a positive rating upgrade by Morgan Stanley. The brokerage upgraded the stock to an ‘overweight’ rating from ‘equal-weight,’ fueling investor optimism. Despite the upgrade, Morgan Stanley revised its target price downward to ₹71 from ₹78.

Morgan Stanley pointed to Suzlon’s recent 45% correction from its peak as a potential buying opportunity. The brokerage emphasized the company’s strong business moat and its strategic position as a key beneficiary of India’s energy transition. With a robust order backlog of 5.1 GW set to be executed over the next two years, Suzlon’s prospects remain positive. The company has also been focusing on securing orders with higher offtake visibility, enhancing its growth potential.

Suzlon’s Market Share Projected to Grow

Morgan Stanley forecasts Suzlon’s market share in India to increase to 35-40% by FY27. The brokerage also anticipates significant demand for wind energy over the next decade, predicting that India will add 32 GW of wind power capacity between FY25 and FY30, worth an estimated $31 billion for wind OEMs (Original Equipment Manufacturers). This trend positions Suzlon to benefit substantially from India’s growing focus on renewable energy.

Strong Quarterly Financial Performance

Suzlon Energy reported strong financial results for the quarter, with revenue rising by 48% year-on-year to ₹2,103 crore, up from ₹1,421 crore in the same period last year. The company’s net profit nearly doubled, reaching ₹200 crore compared to ₹102 crore in the year-ago period. Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) grew 31.3% to ₹293.7 crore, although EBITDA margins dipped slightly to 13.97% from 15.74% in the previous year.

Year-to-Date Performance

Despite the recent correction in stock price, Suzlon Energy shares have delivered an impressive 55% return since the start of the year, reflecting investor confidence in the company’s long-term growth prospects within the renewable energy sector.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.