Multibagger stock climbs 266% from 52-week low, overbought on charts; buy, sell or hold?

Shares of Suzlon Energy have surged 266% from their 52-week low in the last one year. The multibagger stock is currently trading at a 14-year high as the stock hit an upper circuit of 5% on Thursday. Suzlon Energy stock, which fell to a 52-week low of Rs 17.43 on July 27, 2023 rose to a 52 week high of Rs 63.74 on July 25 today.

In the current session, Suzlon Energy shares rose 5% to Rs 63.74 against the previous close of Rs 60.71 on BSE.  Market cap of the firm rose to Rs 84,665 crore. The multibagger stock has risen 957% in the last two years and gained 821% in three years. Suzlon Energy stock opened at Rs 62.79 today higher than the previous close of Rs 60.71 on BSE. In five years, the stock has zoomed 1,600%.

Total 128.95 lakh shares of Suzlon Energy changed hands amounting to a turnover of Rs 81.19 crore on BSE.   

Suzlon Energy shares have a beta of 0.8, indicating low volatility in a year. In terms of technicals, the relative strength index (RSI) of the stock stands at 76.4, signaling it's trading in the overbought zone. Suzlon Energy stock is trading higher than the 5 day, 10 day, 20 day, 50 day, 100 day and 200 day moving averages.     

Brokerage Anand Rathi Shares & Stock Brokers has lowered the stock’s ratings but has increased the target price on the back of steep increase in wind-turbine deliveries.

With an over 32% market share in India’s wind turbines, Suzlon’s Q1 net cash was Rs 1,190 crore, said Anand Rathi. "We expect its focus to shift to deliveries on the impressive 3.8GW OB, and factor in 1.5GW/2.2GW deliveries for FY25/26. India’s wind capacity installations are on track to rise to 8-9GW by FY27, given the government’s insistent thrust, and commercial & industrial demand,” it said.

"We lower our rating to 'hold' with a higher 12-month target price of Rs 69, 40 times FY26e PER (35 times earlier), given the impressive growth opportunities,”  said  Anand Rathi. Earlier, it had a target price of Rs 60 on the stock. Key risks for Suzlon are adverse government policy, slower-than-expected pickup in WTGs, keen competition, added the brokerage

JM Financial has revised its price target to Rs 71 against the earlier target of Rs 54. It has assigned a buy rating to the stock.

"We believe that gradual building of momentum for higher execution, healthy order book, more healthy bid pipeline, strengthening of balance sheet and the organization are driving the company for the next-level of growth," JM Financial said.