Suzlon Energy is an Indian renewable energy company renowned for its wind turbine solutions. It is the largest wind turbine maker in the country with a focus on sustainable innovation and a manufacturing capacity of 3.1-gigawatt (GW) for its 2.1-megawatts (MW) wind turbine generators (WTG).
In the early 2000s, environmentally conscious investments gained popularity as an avenue for financial gain. Suzlon Energy's 2005 IPO, perceived as a green opportunity, garnered substantial attention and was oversubscribed considerably.
Stock prices soared over the next few years, driven by investors' interest in sustainable businesses. The stock soared to the levels of above Rs 400 in early 2008, before the financial crisis crashed the stock markets around the world.
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Despite initial success, Suzlon Energy’s ambitious expansion through large acquisitions strained its finances. Aggressive efforts to enter new markets with new products resulted in compromises on product quality and customer service. These actions eroded the company's sound business model, leading to financial difficulties and a steady decline in stock price.
However, after a period of decline, a strategic investment by Sun Pharmaceuticals promoter Dilip Shanghai, came as a saviour for Suzlon Energy, after he bought 23 per cent stake in the company.
Even with the investment, Covid-19 pandemic came as a death blow for the Suzlon Energy stock as it hit an all-time low of Rs 1.70.
As the narrative of fight against climate change grew in 2021, a shift in the market conditions and a positive psychology towards green energy sources gained traction and things turned around for the Suzlon Energy. The company’s net worth turned positive after a decade in 2023 and posted profits after a wait for six years.
Suzlon’s order book also doubled in the Q1 of 2023. As of March 31, 2023, Suzlon held an order book of 652 megawatts (MW). However, this figure has significantly risen to 1,542 MW due to the acquisition of substantial orders in recent months.
In the current fiscal year, the company has successfully secured orders totalling 890 MW. Notably, approximately 51 per cent (780 MW) of the present order book pertains to the latest 3 MW (S144) wind turbine generator (WTG) series.
Suzlon Energy had launched a Qualified Institutional Placement (QIP) issue on August 9, 2023 to raise Rs 2,000 crore. The offering had an initial size of Rs 1,500 crore, expandable by an additional Rs 500 crore if oversubscribed. The issue's floor price was set at Rs 18.44 per unit. Just like the IPO, this QIP also got oversubscribed in just 3 days.
The current stock price of Suzlon Energy has risen 10x since its lows of Covid-19 pandemic. However, it still stands way below its all-time highs of 2008. Currently, investors are scrambling to figure out the business model, future growth prospects and whether the stock will ever reach the massive all-time-high levels, once again.