Suzlon Energy hits 52-week high; here's why

Shares of Suzlon Energy surged as much as 17.9% to hit a 52-week high of ₹14.39 apiece on the BSE, a day after the company said that the cumulative orders of 1,542 megawatt are the highest since 2019. These include the order book as on March 2023, of 652 megawatt plus orders secured subsequently of 890 megawatt.

On Wednesday, the scrip opened marginally higher at ₹12.57 as against the closing price of the previous session at ₹12.20. At 13:15 pm, the share price of Suzlon Energy was trading 16.72% higher at ₹14.24. At present, shares of Suzlon Energy are trading 165% higher than the 52-week low of 5.43, which the company touched on July 28 last year. During the session, the market capitalisation stood at ₹17,318.21 crore with 19,83,96,112 shares exchanging hands on the BSE against the two-week average of 772.49 lakh shares. In the past month, three months and one year, the counter has given 63.58%, 64.53% and 74.69% returns, respectively.

"Our priority going forward is to pursue quality orders with a higher value and better margins. Our focus remains on execution and building our order book. Our OMS business continues to do well. It has over 16 gigawatts of renewable capacity under maintenance globally, out of which close to 14 gigawatt is in India. With a positive sectoral outlook and strong fundamentals, we at Suzlon are now well equipped to leverage the market opportunity arising from energy transition," said JP Chalsani, CEO, Suzlon Energy.

The company said that Suzlon Energy's consolidated net worth turned positive after 10 years and is at ₹1,099 crore for FY23. Net debt has reduced from ₹13,000 crore on March 31, 2020 to ₹1,180 crore as of March 31, 2023. This is a reduction of more than 90%. The company's FY23 consolidated PAT (profit after tax) before any exceptional items has turned positive after the period of six years and stood at ₹167 crore for FY23 as against the loss of ₹249 crore in FY22.

The company is planning to invest ₹100 crore to ₹150 crore in capital expenditure to augment certain capacities for FY25. "So capital expenditure, we would not need to do certainly for FY24 other than the normal maintenance capex that we do, which is close to about ₹100 crores. But for FY25, we may need to start placing certain advances and orders in FY24. So that may be a delta of another ₹100 crore to ₹150 crore over and above our maintenance capex that we may need to do to augment certain capacities for FY25," Chalsani added.

Chalsani said that the discontinuation of E-reverse bidding and resorting to close bidding, coupled with the state-specific bidding for all 8 states with the Pooled tariff would help the company get back to the pre-FY17 level of capacity additions.

"FY24 wind bid plan 2.5 gigawatts each by SECI (Solar Energy Corporation Limited), NTPC (National Thermal Power Corporation), NHPC (National Hydroelectric Power Corporation) and SJVN (formerly known as Satluj Jal Vidyut Nigam) that is making it to 10 gigawatts…The initiatives like ISTS (inter-state transmission system) waiver, and the extension for COD of projects until June 25, will again boost the C&I segment mainly. Wind repowering potential of 25 gigawatts and the Green Hydrogen mission targets, the concepts like RPO (renewable purchase obligation) and RGO (reduced graphene oxide) obligations which further boost RE sector in a big way," Chalsani said. 

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