Suzlon Energy: MOFSL meets management, cuts valuation multiple and revises target price

MOFSL, which met Suzlon Energy Ltd Executive Vice Chairman Girish Tanti and CFO Rahul Jain to discuss the recent leadership restructuring under the Suzlon 2.0 vision, has cut its valuation multiple on the stock to 27 times from 30 times earlier, which is broadly in line with its historical average two-year forward price multiple. MOFSL said it reflects relatively weaker sentiment across the broader market and within the power and renewables sector.

The domestic brokerage, however, has retained its 'Buy' rating on the stock with a target of Rs 66 apiece. 

"With an order book of 6.5GW, Suzlon Energy has full coverage of our estimated WTG deliveries for 4QFY26/FY27 (0.9GW/3.4GW) and over 50 per cent coverage of our estimated 4GW deliveries in FY28, providing strong medium-term visibility," MOFSL said.

MOFSL said there are still 40GW of renewable energy projects in India pending Power Purchase Agreements (PPAs). Of the 40GW pending PPAs, according to its industry channel checks, plain vanilla solar represents 17GW, while wind accounts for a negligible portion.

MOFSL said the Suzlon management highlighted that there is active engagement among state governments to have these projects rebid or reconfigured. Once this blockade is cleared, the bidding trajectory should scale up, with states also playing a role in building renewable capacity, leading to a broader revival, it said.

"Based on our estimates, Suzlon Energy is currently trading at 9.9 times FY28E Ebitda. This is in line with or below other cap goods players in the power sector such as Thermax (24.4 times) and ABB India (42.3 times).

Suzlon Energy has announced a new management framework, including the formation of a Group Executive Council. JP Chalasani transitioned from Group CEO to a member of the council, Ajay Kapur was appointed Group CEO, and Rahul Jain continued as CFO. The revised structure is aimed at supporting expansion into solar and battery energy storage systems while maintaining leadership in the core wind business, MOFSL said.

"Suzlon has launched DevCo, a dedicated project development vertical, to decouple early-stage development from EPC execution. This initiative strengthens pipeline visibility, enhances readiness for large long-term mandates, and positions the company as a full-stack renewable energy solutions provider," it said.

Meanwhile, ICICI Securities recently suggested a target price of Rs 65 on Suzlon Energy.

"With its existing wind business exhibiting strong potential, Suzlon is now eyeing new, yet related, frontiers. It
has announced a major leadership restructuring as part of its ‘Suzlon 2.0’ vision, aiming to transform into a full-stack, diversified renewable energy solutions provider. The new management structure is designed to expand into project development across wind, solar and BESS, while Suzlon maintains its stronghold in the existing wind business," ICICI Securities said.