Suzlon Energy hits 5% lower circuit ahead of investor meet

Suzlon Energy fell around 5 percent to hit the lower circuit on November 21 morning ahead of an investor meet later in the day. The company said the event is being organised by JM Financial Institutional Securities.

The company’s financials for the fiscal second quarter and the half-year ended September 30 would be discussed in the meeting and no other unpublished price-sensitive information would be shared during the meeting.

At 11.10 am, Suzlon Energy was trading 4.9 percent lower at Rs 39.30 on the National Stock Exchange. The stock has zoomed 267 percent this year against an 8 percent rise for the Nifty during the time.

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JM Financial recently initiated coverage on the stock with a “buy” call. Post the renewable energy solutions provider’s Q2 FY24 results, the brokerage expected the company to clock revenue growth of 38 percent and earnings before interest, taxes, depreciation, and amortization (EBITDA) growth of 43 percent, compounded annually, over FY23-26.

The brokerage revised its estimates for FY25E/26E upwards, driven by healthy order inflow, better execution visibility and an improving product portfolio. It maintained a “buy” rating on the counter with a revised target price of Rs 37 per share based on a 25 times September 2025 earnings per share (EPS). The stock has already moved past this target price.

Suzlon Energy has risen nearly 29 percent this month amid news of its potential inclusion in AMFI’s midcap category during the January reshuffle. Another factor that contributed to the sharp rally was the anticipation of Suzlon Energy being added to the MSCI Global Standard Index. The renewable energy stock was incorporated into the index last week.

For the quarter ended September 2023, Suzlon Energy posted a 45 percent on-year jump in their net profits to Rs 102 crore. However, the revenue declined marginally to Rs 1,417 crore. The company has reduced its debt to negligible levels this year. Its balance sheet is in net cash position now and the balance sheet repair triggered a huge rally in the stock this year.

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According to analysts, Suzlon has witnessed multiple breakouts on lower levels with strong volumes. The counter recently crossed major swing highs of Rs 30. While the trend remains positive, momentum indicators like RSI are in deeply overbought zones on the weekly charts suggesting that a small pullback is likely to be seen. The stock may test Rs 60-62 levels if it stays above Rs 30 level.

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