Abhishek Sinha
Shares of Suzlon Energy Ltd slipped nearly 1% to ₹53.75 on Monday after brokerage firm JM Financial cut its target price for the stock by 15%, even as it maintained a positive long-term view. The revised target now stands at ₹66 (down from ₹78), implying a potential upside of over 22% from current levels.
Despite the target cut, analysts across leading brokerage houses continue to express optimism about Suzlon’s long-term growth prospects, citing a strong order book and a favorable renewable energy outlook — though they flag near-term execution challenges and margin pressures.
🔹 JM Financial’s View
JM Financial noted that while localization in wind energy components and hybrid solar-plus-storage projects are reshaping India’s renewable landscape, execution hurdles — including land and grid connectivity — remain key risks for wind power scalability.
“Execution bottlenecks such as connectivity, land acquisition, and right of way (RoW) continue to constrain the expansion of wind energy. This could limit annual installations to around 7–8 GW. Without broader diversification, Suzlon may find it difficult to sustain high growth beyond FY28,” JM Financial stated.
The brokerage reduced its valuation multiple to 25x FY28 EPS, assuming project execution of 2.5 GW / 3.1 GW / 3.5 GW during FY26–FY28.
🔹 Q2FY26 Estimates & Sector Outlook
Analysts expect Suzlon’s Q2FY26 results to reflect sequential moderation due to seasonal challenges and slower execution.
- Nuvama Institutional Equities projects revenue at ₹2,915.9 crore, up 38.6% YoY but down 6.9% QoQ.
- EBITDA is estimated at ₹470.9 crore, up 60% YoY, with a margin of 16.2%, down from Q1 levels.
- Net profit is expected to be ₹257.5 crore, up 28.3% YoY, but down 20.6% QoQ, largely due to monsoon disruptions affecting project delivery.
“Execution ramp-up and margin performance will remain key monitorables in coming quarters,” Nuvama said, maintaining a ‘Hold’ rating on the stock.
🔹 Other Brokerage Views
- Motilal Oswal Financial Services (MOFSL) expects Suzlon to report ₹2,785 crore in revenue, up 32% YoY, driven by 365 MW of wind turbine deliveries. However, profit may dip 1% YoY. MOFSL reiterated its ‘Buy’ rating with a target price of ₹80.
- Geojit Financial Services remains bullish, forecasting a 42% CAGR in revenue over FY25–FY27 and a 43% CAGR in earnings, citing strong order visibility and improving utilization across business segments.
- Anand Rathi Share & Stock Brokers also retained a ‘Buy’ call, noting that monsoon-related execution delays affected Q2 deliveries but highlighted major project wins, including NTPC (1,166 MW) and Tata Power Renewables (838 MW).
🔹 Fundamental Strength Remains
Suzlon’s strong Q1FY26 exit order book of 5.7 GW provides revenue visibility for the next three years. Brokerages believe that improving utilization across its wind turbine generator, forging, and foundry units will drive operating leverage and margin gains.
With an expected ROE of 27.1% by FY27E, analysts foresee the potential for valuation re-rating if execution efficiency continues to improve.
In Summary:
- Stock Price (Oct 13, 2025): ₹53.75 (-1%)
- Target (JM Financial): ₹66 (↓15%, still +22% upside)
- Order Book: 5.7 GW
- Q2 Revenue Estimate: ₹2,915 crore
- Q2 Profit Estimate: ₹257 crore
- Analyst Consensus: Hold to Buy — strong long-term fundamentals, short-term execution challenges
Disclaimer:
This article is for informational purposes only and does not constitute a buy or sell recommendation from Niveshvani.in. Investors should conduct their own research or seek professional advice before making any investment decisions.
