Suzlon Energy shares rally 8% after MNRE draft; Motilal Oswal see more upside

Domestic brokerage firm Motilal Oswal Financial Services continues to remain positive on Suzlon Energy, citing the renewable energy player to gain market share under the new framework announced by the Ministry of New and Renewable Energy (MNRE) in the near to medium term.

MNRE released a draft notification proposing amendments to the procedure for inclusion/updating of wind turbine models in the revised list of models and manufacturers of wind turbines (RLMM). The draft amendment mandates local sourcing of key components, providing a strong fillip to prospects of Indian OEMs. Motilal Oswal believes that Suzlon is set to benefit from it.

The draft, if finalized, also goes a long way in alleviating concerns regarding competition from Chinese OEMs and a potential loss of market share and pressure on margins, said Motilal. Suzlon is a market leader with domestic manufacturing of all major components and is well-positioned to benefit from it, it adds.

Key provisions of the revised framework include focus on domestic manufacturing; enhanced technical disclosures; certification & collaboration details; data localization & cybersecurity; R&D requirement among the key points. However, it is unclear if these provisions would apply to the existing RLMM list besides new inclusions, noted the brokerage firm.

Amid the optimism over the new framework, shares of Suzlon Energy surged more than 8.35 per cent to Rs 59.70 on Monday, commanding a total market capitalization close to Rs 81,500 crore. The stock had settled at Rs 55.08 on Thursday. The stock is still 31 per cent down from its 52-week high at Rs 86.04 hit in September 2025.

"The type certificate of the wind turbine model shall mandatorily include Blade, Tower, Gearbox and Generator manufacturing facility in India and these components shall only be sourced from such facilities,” the draft said. An exemption will be allowed for the import of these components- for up to 200 MW or one year, whichever is earlier-for any new turbine manufacturer or new model added to the RLMM.

Mandatory domestic sourcing largely removes the pricing advantage enjoyed by Chinese companies, which were until now importing key components from China, said Motilal Oswal. "We believe this limits participation in the wind turbine manufacturing space to long-term players that are committed to investing capital and time," it added with a 'buy' rating and a target price of Rs 75 on Suzlon Energy.

Another domestic brokerage firm 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 has a 'buy' rating on Suzlon with a target price of Rs 71.