Suzlon Energy shares in focus as 2018 wind power project order downsized

Shares of Suzlon Energy Ltd will be in focus on Wednesday morning after the renewable energy solutions provider said the 285 MW wind power project that it bagged in May 2018 from Avikiran Solar India Private Limited has been downsized by the two parties due to disruption of the global supply chain.  

"This is in continuation to our press release dated 30th May 2018 announcing various order wins including that of 285 MW wind power project under SECI 4 bid located in Kutch, Gujarat from Avikiran Solar India Private Limited. This is to inform that due to devastating impact of the COVID19 global pandemic and the resultant disruption of the global supply chain, the parties have decided to downsize the project limiting to 168 MW," Suzlon Energy said in a BSE filing.

The stock has been in news after bagging multiple deals of late. Suzlon Energy recently won a 201.6 MW order from O2 Power Private Limited, wherein it will install 64 of its largest wind turbine generators (WTGs) with a Hybrid Lattice Tubular (HLT) tower and a rated capacity of 3.15 MW each for the 201.6 MW wind power project. The project is expected to be commissioned in 2025.

Besides, Suzlon bagged an order for the development of a 31.5 MW wind power project for Integrum Energy Infrastructure. Suzlon sad it would install 15 units of their S120–140m wind turbine generators (WTGs) with a Hybrid Lattice Tubular (HLT) tower and a rated capacity of 2.1 MW each in Maharashtra and Karnataka. The project is expected to be commissioned in May 2024, it added. The group, however, didn't disclose the value of the said project.

Adding the momentum is the recent coverage initiation on Suzlon Energy by JM Financial Ltd with a 'Buy' rating and a September 2024 target of Rs 30 per shares. The brokerage cited industry tailwinds, a deleveraged balance sheet and a robust order book behind its buy rating on the stock. JM Financial sees a strong pick-up in the company’s performance going forward.

It is to be seen how the market reacts to the downsizing of an old order.

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