Suzlon shares: Motilal Oswal cuts price target; flags a short-term negative for stock

Suzlon Energy shares have seen a price target cut by brokerage firm Motilal Oswal, which has flagged a short-term negative for the stock. The domestic broker continues to remain overall positive on the counter, thanks to a strong a quarterly performance and strong order book but a resignation from its key managerial personnel may add to short-term pressure.

The announcement of Group CFO Himanshu Mody’s departure could be a slight short-term negative, given his instrumental role in the company’s balance sheet turnaround, said Motilal Oswal Financial Services. "We do not believe it will derail the company’s strong business momentum, which continues to be supported by positive regulatory tailwinds," it said.

Motilal Oswal cut its FY26 adjusted PAT estimate by 25 per cent as it builds in an effective tax rate of 25 per cent (deferred tax and non-cash). It also marginally adjusted the FY27 tax rate higher to 12 25 per cent. "We arrive at our target price of Rs 80 by applying a target P/E of 35 times to FY27E EPS," it added, reiterating a 'buy' rating but cutting its target from Rs 82 earlier.

Shares of Suzlon Energy gave up early gains and dropped 5.5 per cent from day's high at Rs 63.82 to Rs 60.33 on Wednesday. Its total market capitalization of the company barely managed to hold Rs 83,000 crore. The stock had settled at Rs 63.12 on Tuesday. It has plunged nearly 30 per cent from its 52-week high at Rs 86.04.

However, Motilal Oswal is not the only brokerage firm cutting its target price on Suzlon Energy. JM Financial and Nuvama Institutional Equities. JM Financial has trimmed its target price to Rs 78 from Rs 81 earlier, but maintained a 'buy' rating, while Nuvama has a 'hold' tag for Suzlon, slashing its target price of Rs 67 from Rs 68 earlier.

Suzlon Energy reported a 7.3 per cent YoY growth in the net profit at Rs 324.3 crore, while revenue increased 55 per cent YoY to Rs 3,131.7 crore for the June 2025 quarter. The wind energy player clocked a 62.4 per cent YoY surged in Ebitda to Rs 598.2 crore, while Ebitda margins improved to 19.1 per cent for the quarter.

With the manufacturing capacity of 4.5 GW and an order book of 5.7 GW, the company is confident of 60 per cent growth in key performance parameters. As utilities’ new renewable energy tenders slow down, commercial and industrial customers are driving growth, especially in wind power, said JM Financial.

"Current installations have consistently stayed at 20 per cent of the deliveries over the past three months for the last three quarters, which is a cause for concern. Considering deliveries of 2500 MW/3100 MW in FY26/FY27, we arrive at an EPS of Rs 1.51/ Rs 2.31 during FY26/FY27, maintain 'buy' with a revised target of Rs 78 based on a 35 times FY27 EPS" it added.

"We remain positive on Suzlon as its order book is robust at 5.7GW but we are trimming FY26E/27E EPS by 4 per cent/1 per cent to factor in softer realisation as the EPC mix remains low," said Nuvama.