Suzlon Energy shares: Motilal Oswal ups its target price; see up to 30% upside; here why

Domestic brokerage firm Motilal Oswal Financial Services (MOFSL) continues to remain positive on Suzlon Energy Ltd amid improving execution and higher local content key positives. The broker sees up to 30 per cent upside in the multibagger renewable energy player as it has revised its targets.

The recent draft revised list of models and manufacturers of wind turbines (RLMM) notification mandating local content in wind turbine manufacturing is a key medium-/long-term positive for Suzlon Energy, said Motilal Oswal. "According to our channel checks, power project developers will likely request the government for delayed implementation of the draft notification," it said.

It sees two key implications from the recent draft RLMM notification: should the draft receive regulatory approval, we see competitive intensity moderating in the medium term, and) there is scope for further market share expansion for Suzlon given Indian OEMs account for barely 50-60 per cent of new orders and Suzlon's integrated domestic manufacturing capabilities.

Shares of Suzlon Energy rose nearly 2.70 per cent to Rs 59.80 on Wednesday, with its total market capitalization hitting Rs 81,000 crore mark. The stock had settled at Rs 57.62 in the previous trading session. The stock is currently 33 per cent down from its 52-week high mark at Rs 86.04, hit in September 2024.

Suzlon is focused on raising its share of EPC contracts in the overall order book, which will be key in providing greater visibility and control in terms of deliveries, the brokerage firm noted. Indian OEMs are now exploring export opportunities that may emerge as a medium-term catalyst, Motilal Oswal said.

"We model an FY26 delivery of 2.4GW, implying a quarterly run rate of 600MW, which we believe is reasonable. Our estimates imply Suzlon's revenue/adjusted PAT to clock a 46 per cent/58 per cent CAGR over FY25-27. As per our understanding, key orders slated for FY26 already have substantial land acquisitions completed and have high power evacuation visibility," 'it added.

Motilal Oswal reiterated its 'buy' rating on Suzlon Energy with a revised target price of Rs 75 (based on 32x FY27E EPS). Suzlon is currently trading at 24 times FY27E PE, which it believes is attractive after the recent correction. The target price suggests a 30 per cent upside from its previous close.

Domestic brokerage JM Financial expects Suzlon Energy's revenue to increase 56 per cent YoY to Rs 3,421.1 crore in March 2025 quarter due to estimates of higher dispatches in the quarter. Improvement in Ebitda is likely due to better orders dispatch and execution YoY. It is expecting Ebitda to come in at Rs 542.4 crore, up 52 per cent YoY, while net profit may come in at Rs 444.7 crore, up 75 per cent YoY.

JM Financial has a 'buy' rating on Suzlon with a target price of Rs 71. Another brokerage firm Motilal Oswal has a 'buy' rating on the stock with a target price of Rs 75.