On August 12, Suzlon Energy's shares reached a multi-year high of Rs 80.36 on the NSE after hitting a 5% upper circuit. The multibagger stock has returned 47% in the past month alone after it passed the Rs 1 lakh crore market capitalization milestone last week. Since March 2010, the stock has been trading at its greatest level.
Following the execution of final agreements for the purchase of a 76 percent ownership in Renom Energy Services Private Limited (Renom), in two tranches, from the Sanjay Ghodawat Group (SGG), Suzlon shares have increased in value for the fourth session in a row.
Suzlon has an overweight call from Morgan Stanley with a target price of Rs 73.4 per share, which has already been exceeded. The purchase of Renom Energy Services, according to the global brokerage, is a calculated move into the multibrand Operations and Maintenance Services (OMS) market.
According to MS's comment, the implied valuation of 4x price to sales is deemed less expensive than that of its listed comparable.
Prabhudas Lilladher claims that Suzlon Energy's stock has regained strength and that the next possible objectives of Rs 82 and Rs 98 levels are anticipated in the upcoming days. This is due to the daily chart showing a higher low formation pattern.
"With maintaining the near-term stop loss of Rs 71, one can hold on to the stock with much upside potential visible and further gains can be anticipated," it said.
The 'buy' recommendation on Suzlon shares has been upheld by JM Financial. With India aiming to achieve 100 GW of wind energy capacity by FY30, the business is expected to use Renom to seize the 32GW non-Suzlon OMS market (10GW immediate potential).
"Suzlon will be exposed to new locations as a result of the transaction, and it may profit from newly developing repowering prospects. "We believe the acquisition represents a strategic move by Suzlon, enhancing its capabilities, expanding its market presence, and creating value," the brokerage stated.
Suzlon Energy shares were locked in at Rs 80.36, the 5 percent upper circuit, on the National Stock Exchange (NSE) at 1:23 pm. Suzlon's market capitalization has increased to Rs 1.1 lakh crore following today's significant increase.
The stock has increased by 108% this year, much exceeding the gains of the Nifty 50, which increased by more than 12% in the same time frame. The stock has produced remarkable gains over the last year, nearly quadrupling investors' wealth at a rate of 300 percent.
