Domestic brokerage firm Anand Rathi Shares and Stock Brokers continue to remain positive on Suzlon Energy after its March 2024 quarter earnings. The brokerage has reiterated its buy rating on the stock suggesting an upside potential of 30 per cent in the multibagger stock.
Suzlon Energy reported a 9 per cent fall in consolidated net profit on a year-on-year (YoY) basis at Rs 254 crore in the quarter ended March 31, 2024. The company had posted a net profit of Rs 280 crore in the year-ago period. Revenue from operations increased 29 per cent to Rs 2,179 crore in the quarter under review from Rs 1,689 crore in the same period last fiscal.
Suzlon Energy's Ebitda for the March 2024 quarter increased by 54 per cent YoY to Rs 357.2 crore, while margin expanded by 260 basis points (bps) to 16.3 per cent. Suzlon mentioned that it has closed the financial year 2024 with its largest ever order book at 3.3 GW. It recently won a repeat 402 MW order from Juniper Green Energy.
"Suzlon reported strong Q4 Ebitda and net profit and results beat our estimates on the back of due to higher margins," said Anand Rathi's report. "The present wind turbine OB is of 3.3GW and included equipment supplies, which constitute 66 per cent, with the rest including EPC scope. Captive/commercial and industrial (C&I) orders accounted for 58 per cent of the order book."
Wind turbine deliveries were of 273MW in Q4 and 710MW in FY24. Q4 wind turbine EBIT was Rs 65.6 crore and operations & management Q4 ebit was Rs224 crore, Anand Rathi said. "On its 3.3GW order backlog, we build in 1.5GW/2GW WTG deliveries in FY25/FY26. Challenges in grid connectivity and land acquisition could delay delivery, impacting earnings," it said.
Anand Rathi maintained a 'Buy' with a 12-month target price of Rs 58, 35 times FY26e PER, given the impressive growth opportunities. However, it has cited adverse government policy, slower-than-expected pickup in WTGs, keen competition as the key risks for the business.
Not only Anand Rathi, even other brokerage firms like ICICI Securities and JM Financial are positive on Suzlon Energy. Both the brokerage firms have a 'buy' rating on the stock with a target price of Rs 54 on the counter, suggesting an upside of 20 per cent in the counter.
It has been a real turnaround year for Suzlon Energy (Suzlon), with becoming net debt free, strong execution growth of 10 per cent to 710MW and order inflow of 3.1GW in FY24. Suzlon has reported strong order inflow of 3.1GW in FY24 and 402MW in FY25-YTD, robust order backlog of 3.3GW as on date while order inflow pipeline remains strong in the medium term, said ICICI Securities.
Suzlon Energy reported a strong Q4 earnings with improvement in EBITDA margin, said JM Financial. SE Drive Technik GmbH (SEDT), Germany, a step-down subsidiary was liquidated leading to a one-time loss of Rs 27 crore in Q4FY24, said JM Financial in its report.
"With a healthy order book and more-healthy bid pipeline, strengthening of balance sheet and the organization, amidst the execution challenges for step-up in annual capacity addition beyond 5GW, we maintain our 'buy' rating on the stock with an unchanged target price of Rs 54," based on a 30 times FY26E EPS, it added.
Shares of Suzlon Energy settled at Rs 45.25, falling 1.25 per cent for the day, and commanding a total market capitalization of more than 61,500 crore for the day on BSE.