Suzlon Energy shares hit 5% upper circuit; rise for fourth session; what's next?

Shares of renewable energy firm Suzlon Energy Ltd gained for the fourth straight session today amid volatility in the broader market. The stock has risen nearly 9%  or Rs 1.59 since Friday last week. In the last three months, the Suzlon Energy stock has zoomed 132%. The stock’s current phase of rally started on Friday (August 4) when it snapped two days of losing streak while falling 7% in the last two sessions.  In the current session, shares of Suzlon Energy rose 5% intraday to Rs 19.56 on BSE against the previous close of Rs 18.63. Market cap of Suzlon Energy rose to Rs 24,122 crore. Turnover and volumes were high for the Suzlon Energy stock with 460.29 lakh shares changing hands amounting to a turnover of Rs 89.57 crore on BSE.   

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The stock hit a 52-week high of Rs 20.80 on July 25, 2023 and a 52-week low of Rs 6.60 on October 13, 2022.  

In terms of technicals, the relative strength index (RSI) of the stock stands at 57.4, signaling it's trading neither in the overbought nor in the oversold zone. Suzlon Energy shares have a beta of 1.6, 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.      

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Here's look at what experts said on the outlook of the stock.

Abhijeet from Tips2trades said,"Suzlon Energy is bearish  on the Daily charts with next resistance at Rs 19.4. Investors should book profits at current levels or hold till Daily support of Rs 17.7 is broken on a closing basis."  

Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher said, “The stock has picked up well from Rs 8 levels and recently found consolidation near the  Rs 17-18.50 zone after it touched the high of 20.80 levels. The near term support is maintained near Rs 17 level and above Rs 20.80, a fresh breakout would be indicated for further upside targets of Rs 26 and Rs 34 levels.”  

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Osho Krishan, Sr. Analyst - Technical & Derivative Research at Angel One said, “Suzlon has massively soared more than two times in the current financial year on the back of robust volumes. On the technical chart, the stock has witnessed several pivotal breakouts and currently hovering at new 52-week highs. The recent rally was vertical in nature, which snubbed in between price-wise corrections. The technical parameters indicate the counter is in the over-bought territory and one should not be carried away with the ongoing momentum. As far as levels are concerned, a series of support is placed around 17 odd zone on an immediate basis, followed by sacrosanct support of 14-15. On the flip side, a substantial hurdle could be seen around the 20-24 zone in the comparable period.”  

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Manoj Dalmia, CEO of Proficient Equities said, “Despite the company's reduced debt, it faces challenges with a low interest coverage ratio and high borrowing costs. Risk-averse investors are advised to refrain from purchasing at current levels, instead considering buying above Rs 21. On the other hand, those with a higher risk appetite may consider purchasing with a tight stop loss, as a close above Rs 21 could potentially drive the stock to Rs 30. The company's prospects appear promising, as the board has approved a capital raise of Rs 2000 cr through QIP to repay debt. Nevertheless, investors should diligently monitor fundamentals and remain vigilant for any potential red flags moving forward.”  

The firm announced its Q1 earnings on July 25.     

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Suzlon Energy reported a 96 per cent fall in consolidated net profit at Rs 101 crore in the April-June quarter against a consolidated net profit of Rs 2,433 crore in the year-ago quarter. The company's net revenue in the first quarter of this fiscal also fell to Rs 1,348 crore from Rs 1,378 crore in the year-ago period.  

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.        

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