Anand Rathi Reaffirms ‘Buy’ Rating on Suzlon Energy (SUZLON) Amid Promising Turnaround Prospects

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    <li>In its most recent report, domestic brokerage firm Anand Rathi reiterated its 'buy' recommendation on Suzlon Energy with a price target of ₹58 apiece, emphasizing the company's notable market position in India's wind turbine sector.</li>
    <li>The brokerage highlighted Suzlon's achievement of net cash totaling ₹11.4 billion in FY24, marking the first instance since FY06.</li>
    <li>"Supportive government policies would continue to drive earnings and reratings. Limited competition is an additional positive even though structural issues like grid connectivity, land acquisition-related challenges and keener competition would determine the pace of earnings," said Anand Rathi.</li>
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<p><strong>Anand Rathi reaffirms 'buy' rating on Suzlon Energy, citing robust market position and significant financial turnaround.</strong></p>
<h2><strong>Impressive Performance</strong></h2>
<p>The company on Friday delivered robust Q4 results, with EBITDA reaching ₹3.6 billion and PAT at ₹2.8 billion, marking a notable increase of 54% and 314% year-on-year, respectively. These figures surpassed the brokerage's projections of ₹3.2 billion for EBITDA and ₹2.6 billion for PAT.</p>
<h3><strong>Financial Highlights</strong></h3>
<p>Furthermore, for FY24, Suzlon reported EBITDA and PAT of ₹10.3 billion and ₹6.6 billion, representing year-on-year growth of 25% and 296%, respectively. The company's current wind turbine order book stands at 3.3 GW, predominantly comprising equipment supplies, which constitute 66% of the total.</p>
<h2><strong>Favorable Market Conditions for the Indian Wind Industry</strong></h2>
<p>India holds the 4th position in the world for renewable energy installed capacity, including large hydro. It ranks fourth in both wind power capacity and solar power capacity.</p>
<p>India's ambitious goal of installing 500 GW of non-fossil fuel capacity by 2030, achieving net-zero emissions by 2070, and meeting 50% of its electricity needs from renewable energy sources by 2030 marks a momentous milestone in the global effort against climate change.</p>
<h3><strong>Wind and Solar Energy Growth</strong></h3>
<p>This growth trajectory will predominantly be steered by the wind and solar energy sectors. Wind energy currently contributes 10% (43 GW) of the total installed capacity of 442 GW, and projections indicate that it will ascend to 13% (100 GW) by 2030.</p>
<p>Similarly, solar energy, which presently constitutes 19% (82 GW) of the total capacity, is forecast to burgeon to 38% (293 GW) by 2030, showcasing a substantial increase in its share of the overall power capacity.</p>
<h3><strong>Conclusion</strong></h3>
<p>In conclusion, Suzlon Energy's financial turnaround, supported by favorable government policies and a robust market position, presents a promising outlook for investors. With significant growth in wind and solar energy sectors, Suzlon is poised to capitalize on India's renewable energy ambitions, making it a compelling investment opportunity.</p>