Suzlon Energy, a leading renewable energy company in India, has seen a significant surge in its share price in recent months. The stock has been on an upward trend since mid-May 2023, when it hit a low of ₹8.20 per share. Since then, the share price has soared to ₹16.80 per share, delivering an impressive multibagger return to its shareholders.
In the last month alone, Suzlon Energy’s share price has risen by almost 50%, from ₹11 to ₹16.80 per share. This strong performance has caught the attention of investors and experts, who believe that there is still more room for growth in this energy stock.
ICICI Securities, a prominent brokerage firm, has given a buy rating to Suzlon Energy shares. According to the brokerage, the Indian power grid is in need of more wind energy to meet the rising demand while reducing carbon emissions. The government has taken several policy initiatives to promote the growth of the renewable energy sector, including wind-specific renewable purchase obligations (RPOs) and closed bidding for wind auctions. These policies are expected to provide a favorable environment for Suzlon Energy, which is the market leader in the wind energy sector.
Additionally, Suzlon Energy’s financial position has improved significantly, with the company’s net debt to EBITDA ratio declining to approximately 1x from about 10x in FY22. This improvement in the company’s balance sheet further enhances its growth prospects.
ICICI Securities recommends positional investors to consider buying Suzlon Energy shares, as they believe the company is well-positioned to benefit from the tailwinds in the industry. They expect a sharp increase in earnings from FY24E onwards. The brokerage has set a target price of ₹22 per share, based on a multiple of 24x FY25E earnings per share.
Investors and market watchers are optimistic about Suzlon Energy’s future prospects, as the demand for renewable energy continues to grow in India. The company’s strong presence in the wind energy sector, combined with supportive government policies, positions it for further success.
In conclusion, Suzlon Energy has witnessed a remarkable surge in its share price, delivering substantial returns to its shareholders. With favorable market conditions and an improved financial position, the company is poised for further growth in the renewable energy sector. Investors are advised to consider the potential of Suzlon Energy shares and make informed investment decisions.
