Suzlon Energy shares trading at five-year high; buy, sell or hold? (2024)

Shares of Suzlon Energy Ltd are trading at over five-year high led by a strong up move in the renewable energy stock in the last three months. Suzlon Energy stock closed at Rs 14.76 in the last trading session, a level last seen in January 2018. On January 12, the stock closed at Rs 14.87 and fell to Rs 14.73 on January 15, 2018 on BSE. Considering the current level of Rs 14.76, the stock has gained a whopping 108% in the last three months.

The stock has been rising for the last four sessions. Suzlon Energy shares ended 4.83% to Rs 14.76 on Wednesday against the previous close of Rs 14.08 on BSE. Market cap of the firm rose to Rs 18,311 crore. The stock has surged 48% in the last one month and gained 127% in a year. The stock has rallied 246% in three years.

ALSO READ: Suzlon Energy shares rose 108% in three months; two factors behind the rally

In the current session, turnover and volumes were high for the stock with 310.99 lakh shares changing hands amounting to a turnover of Rs 45.78 crore on BSE.

On June 5, the firm said it has surpassed 20 GW in wind energy installations. The statement took the stock 31% higher from June 5 to June 7 on BSE. On June 7, it hit a 52-week high of Rs 14.59 on BSE. The stock further hit a fresh yearly high of Rs 15.76 on June 13, 2023.

Watch: Nifty, Sensex touch fresh lifetime highs, Bank Nifty at new peak; where is share market headed, what should investors do?

In terms of technicals, the relative strength index (RSI) of Suzlon Energy stock stands at 67.1, signaling it's trading neither in the overbought nor in the oversold zone. The stock has a beta of 1.5, indicating very high volatility in a year. Suzlon Energy stock is trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

On the outlook of the stock, Abhijeet from Tips2trades said, “After a brief correction, Suzlon Energy looks bullish on the Daily charts with strong support at Rs 13.25. A daily close above resistance of Rs 15.8 could lead to Rs 17.8 in the coming days."

ICICI Securities has initiated coverage on Suzlon Energy with a buy call. It has assigned a target price of Rs 22 for the renewable energy stock.

"We believe Suzlon is best equipped to benefit from industry tailwinds. We expect a sharp uptick in earnings FY24E onwards. Suzlon has reduced leverage by restructuring its debt and by raising money through a rights issue. As a result, leverage is now merely 1x debt/EBITDA. Initiate with BUY and a target price of Rs 22 per share (assigning a multiple of 24x FY25E EPS)," the brokerage said.

Explaining the rationale behind its stance, it said, "The lowest-cost solution for an optimal decarbonised grid is a mix of wind, solar and battery storage capacities. Wind generates powerin monsoon and nights when solar generation is low. Also, we believe higher wind will lead to lower battery storage requirement for a decarbonised grid."

"Suzlon has enjoyed a market share of 33%in India’s domestic market (based on total installations)(source: company). It has 20GW of operational wind power capacitygloballyand is well ahead of its competitors. Note that its existing order book at 1.5GW bodes well for execution through the next two years," added the brokerage.

Suzlon Energy is a provider of renewable energy solutions. The company is a producer of wind turbines. It offers a range of solar energy solutions, such as solar irradiance assessment, land acquisition and approvals, infrastructure and power evacuation, supply chain, installation and commission and life cycle asset management.

Also read: Tata Motors, Canara Bank, ZEEL: How should you trade these buzzing stocks?

Also read: Rs 58 to Rs 256: This steel stock turned into a multibagger n three years

Also watch: MCX shares plunge 12%; know what is 63 Moons issue and why it is dragging the stock. Should you buy MCX shares?