Suzlon Energy stock downgraded to 'accumulate' by Geojit; but target price raised to ₹77 from ₹71

Mint

a day ago

Domestic brokerage house Geojit Financial Services has revised its outlook on Suzlon Energy, downgrading the stock from a 'Buy' to an 'Accumulate' rating. Despite the revised stance, the brokerage firm has increased its target price to ₹ 77 from the earlier ₹ 71, indicating a potential upside of 17 percent from previous close of ₹ 65.67. The adjustment reflects Suzlon's promising growth prospects, driven by a robust order book and strong performance in its wind turbine business.
Geojit highlighted Suzlon's expanding order book of over 5.5 GW, which it believes will support a 41 percent compound annual growth rate (CAGR) in wind turbine generator (WTG) deliveries from FY25 to FY27. The brokerage expects Suzlon's earnings to grow at a 38 percent CAGR over this period, while return on equity is projected to improve to 26 percent.
However, Geojit cautioned about execution risks that could arise in managing large-scale projects. Despite this, the company's recent financial performance lends credibility to its growth trajectory.
Suzlon delivered 573 MW of WTG capacity in Q4FY25, marking a 110 percent year-on-year increase. Its consolidated revenues jumped 73 percent during the quarter, with the WTG segment alone growing 105 percent year-on-year.
While gross margins dipped 133 basis points to 35 percent due to a higher contribution from the lower-margin WTG business, Suzlon's EBITDA margin improved by 202 basis points to 18 percent. This improvement was driven by economies of scale and better capacity utilization. EBIT margins in the WTG and foundry segments rose by 903 and 34 basis points, respectively.
Suzlon Energy posted a sharp improvement in its consolidated financial performance for the quarter ended March 2025, with net profit surging to ₹ 1,182.22 crore, up significantly from ₹ 254.12 crore reported in the same period last year.
The company also delivered strong top-line growth, as revenue from operations jumped 73 percent year-on-year to ₹ 3,773.54 crore, compared to ₹ 2,179.20 crore in the March 2024 quarter.
As of the end of FY25, the company had a net cash position of ₹ 1,943 crore and a consolidated net worth of ₹ 6,106 crore, indicating a strong balance sheet.
Meanwhile, another brokerage house Nuvama Institutional Equities also maintained a positive long-term outlook on Suzlon, although it has retained its 'Hold' rating. It raised the target price from ₹ 61 to ₹ 68, citing the company's strategic positioning in India's clean energy transition.
'Suzlon remains a key beneficiary of the increasing share of firm and dispatchable renewable energy (FDRE), round-the-clock (RTC) power, and hybrid tenders in the Indian energy landscape,' Nuvama noted. The firm also emphasised Suzlon's duopolistic presence in the EPC and wind turbine generator market, holding a 30 percent market share. Additionally, the company serves both the commercial & industrial (C&I) and PSU segments, with C&I accounting for 55 percent of the order book.
Suzlon Energy's stock has experienced significant volatility over the past year. It touched a 52-week high of ₹ 86.04 in September 2024 and a low of ₹ 46 in April 2025. Over the past 12 months, the stock has gained over 30 percent.
However, the trend in 2025 has been mixed. After a 27 percent surge in May, the stock has declined nearly 10 percent in June so far. Earlier in the year, it fell marginally in April and February but gained 14 percent in March. January also saw a 6.5 percent decline.