Suzlon Energy sells corporate office, One Earth Property, for Rs 440 crore. But, there's a catch!

Suzlon Energy Ltd on Wednesday announced that it sold One Earth Property, its corporate office, to OE Business Park Pvt Ltd for Rs 440 crore. "This is to inform that the company has executed a Conveyance Deed with OE Business Park Pvt Ltd (OEBPPL) for sale of One Earth Property, being its corporate office. OEBPPL is a special purpose vehicle, shares of which are held by funds managed by 360 ONE Alternates Asset Management Ltd," the renewable energy provider stated in a BSE filing.

However, One Earth Property will be leased back to Suzlon for five years with sub-leasing and licensing rights once the sale is done. "On completion of the sale, the One Earth Property would be leased back to the Company for a period of up to 5 (five) years with sub-leasing and licensing rights. Further, the Company has also entered into agreements with the holders of the securities issued by OEBPPL providing the Company with a 'call' option to purchase and granting the holders of the securities a 'put' option to sell the securities," Suzlon mentioned.

The 'Call' option gives buyers the right to purchase a security at a pre-determined price. And, the 'Put' option gives holders the right to sell the security at a pre-determined price. With that being said, a buyer is not obligated to exercise the option.

Suzlon also informed that the sale is outside the "Scheme of Arrangement" and was approved by its shareholders at the extraordinary general meeting of the company held on March 25, 2022.

The announcement came after market hours today. Earlier in the day, Suzlon shares shed 0.43 per cent to settle at Rs 74.18. At this price, the multibagger stock has rallied 207.93 per cent in a year.

On technical setup, support on the counter could be seen at around the Rs 70 zone. And, a decisive close above the Rs 81-84 range is required for further upside, an analyst said.

Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "Suzlon recently experienced profit-taking after a significant rally from Rs 54 to Rs 84. Technical analysis suggests a potential cooling-off period. The Rs 70 zone is likely to serve as immediate support for the stock. On the upper end, the Rs 81-84 range has proven to be a strong resistance and a decisive breakthrough would only indicate the start of a new rally."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "Support will be at Rs 72.5 and resistance at Rs 75. A decisive close above the Rs 75 level may trigger a further upside to Rs 78. The expected trading range will be between Rs 70 and Rs 78 for the short term."

Sebi-registered research analyst AR Ramachandran said, "Suzlon Energy stock price is slightly bearish on daily charts with strong resistance at Rs 78.7. A daily close below support of Rs 73 could lead to 66 in the near term."

As of June 2024, promoters held a 13.27 per cent stake in the company, which is slightly lower from 13.29 per cent in the previous quarter.