Buy Suzlon Energy, Waaree Energies, BHEL, Premier Energies shares, says UBS

Foreign brokerage UBS has initiated coverage on BHEL Ltd, Waaree Energies Ltd, Premier Energies Ltd, Suzlon Energy Ltd with a 'Buy' rating. It also retained its 'Buy' rating on Thermax with an increased target price of Rs 5,100 apiece, and on Triveni Turbine.

UBS suggested a target price of Rs 78 on Suzlon Energy, Rs 340 on BHEL, Rs 1,340 on Premier Energies and Rs Rs 4,400 on Waaree Energies. The brokerage said it took an anti-consensus yet constructive view on India's power generation equipment OEMs, supported by a broader upcycle.

It believes this cycle could be longer and more robust, led by both renewable and thermal power, with industry revenue potential of Rs 11 lakh crore or 22 per cent CAGR over FY25-30E. This is unlike the past thermal-led cycle, it said.

Besides, UBS sees execution and integration gaps. The foreign brokerage said markets may underappreciate execution strength in thermal and challenges of backward integration in solar module manufacturing amid tightening localisation norms. 

UBS noted that the private sector is driving renewable additions, while the government leads thermal. 

The foreign brokerage said there is enough scope for stakeholder value creation. Solar incumbents are investing 4 times against FY25 gross block to meet strong domestic and export demand. 

"Higher execution in thermal and wind, along with a healthy outlook for industrial power, drives growth visibility. We see scope for earnings and order-led value creation over the next 3-5 years, offering a favourable setup for returns, driven by scale, policy tailwinds, and technology adoption. We see value across UBS India power generation equipment value chain. Our top pick order is BHEL, Thermax, Waaree Energy," it said.