Stocks to buy: Suzlon Energy Ltd | Suzlon Energy rights issue gets 1.8x bids

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by 5paisa Research Team Last Updated: 2022-11-21T10:31:05+05:30

5paisa expert research team recommends to buy Suzlon Energy stock 

About:-

Suzlon Energy's main line of work is producing wind turbine generators (WTGs) and associated parts with varying capacities.

Update:-

‘A 48.3 MW wind power project will be developed for Adani Green Energy Ltd. by Suzlon Energy, one of India's top providers of renewable energy solutions.

23 of Suzlon's wind turbine generators (WTGs) with 2.1 MW rated capacities and Hybrid Lattice Tubular (HLT) towers will be installed. The project will be completed in 2023 and is situated in Mandvi, Kutch, Gujarat.

This purchase is an additional 226.8 MW repeat order from Adani Green Energy Ltd. that was first announced on August 13, 2021. The project will be carried out by Suzlon with a supply, installation, and commissioning scope. Suzlon will also provide services for post-commissioning operation and maintenance.

Rights issue utilisation:-

Suzlon Energy's rights offering entails the purchase of up to Rs. 240 crores partially paid-up equity shares for a total of Rs 1,200 crore at a price of Rs. 5 per share (with a premium of rs3 per rights equity share). The promoters for Suzlon have affirmed their participation and stated that they will completely subscribe to the full extent of their legal entitlement.

The corporation intends to use the funds collected for general corporate objectives as well as the prepayment of a portion of any existing borrowings that the company and its subsidiaries have taken out. The principal manager of the problem is Inga Ventures.

Himanshu Mody, the Chief Financial Officer (CFO) of Suzlon Energy Ltd, stated last week during a virtual press conference that if the company's rights offer for rs1,200 crore is fully subscribed, it will be able to reduce its debt by rs583.5 crore. According to Mody, there won't be a drop in the promoters' ownership following the issuance, and the company will have a much leaner, healthier, and better balance sheet.

Key initiatives and priorities:-

In FY22 Suzlon made a good recovery on wind installations. In FY23, a major focus for Suzlon to regain the top spot as the market leader in the Indian wind industry. The company also focuses on expanding its wings in hybrid (wind and solar) space.
The key priorities and initiatives that will help us to grow as envisioned are as follows:
• To provide best-in-class service spanning the entire lifecycle of wind energy projects
• To regain the market leadership position with an improved market share
• To reduce LCOE through better technology and products more specific to the market conditions
• To optimize cost through value engineering and improved efficiencies across the value chain
• To continuously beat the market benchmark and achieve the best machine availability
• To help improve efficiencies and better yields for our customers
 

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About the Author

Our research team is composed of some highly qualified research professionals, their expertise range across sectors.

Disclaimer

Investment/Trading is subject to market risk, past performance doesn’t guarantee future performance. The risk of trading/investment loss in securities markets can be substantial. Also, the above report is compiled from data available on public platforms.

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