Suzlon shares in 'deeply' oversold zone, hit fresh 52-week low; what should investors do?

Shares of Suzlon Energy Ltd hit a fresh 52-week low on Thursday, breaching its previous low reached in March this year. Earlier, the multibagger slipped to a 52 week low of Rs 38.17 reached on March 9 this year. Suzlon Energy is undergoing a time correction in the last two years, slipping 49% during the period.

During time correction, a stock or index trade sideways in a narrow, flat range for a long period rather than dropping sharply.

Suzlon stock movement

The selloff in the Suzlon Energy stock has dragged it deep into the oversold zone. The RSI of the stock fell to Rs 19.6 today. A stock with RSI below 30 signals it has more sellers than buyers on the counter.

Reflecting a bearish trend, Suzlon Energy stock is trading below its 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day simple moving averages.

In the current session, Suzlon Energy stock fell 2% to a low of Rs 37.64, with market capitalisation falling to Rs 51,768 crore. The stock has lost 29% in three months and and gained 29% in three years.

However, Suzlon Energy has delivered multibagger returns of 463% in five years.

Suzlon Energy price targets

Jigar S Patel from Anand Rathi said, "Support is placed at Rs 36 , while resistance stands at Rs 40. A decisive breakout above Rs 40 could open the door for further upside towards Rs 42. For the short term, the stock is expected to trade within the Rs 36-42 range."

KKunal V Parar, VP of Technical Research and Algo, Choice Broking said, "Suzlon Energy continues to remain under selling pressure, with the stock forming a series of lower highs and lower lows on both daily and weekly charts. The stock is currently hovering near its crucial long-term support of Rs 38, while trading below its 200-day EMA of ?50.35 and 200-week EMA of Rs 46.16, indicating weakness in the broader trend. However, with the daily RSI near 18 and weekly RSI around 26, the stock has entered deeply oversold territory, raising the possibility of a technical pullback. A decisive breakdown below ?38 could accelerate selling pressure towards 35–33. On the upside, Rs 40–42 remains the immediate resistance zone, followed by Rs 46."

Centrum Broking has a target price of Rs 74 on the Suzlon Energy stock. It has a buy call on the stock. It said Suzlon remains one of the key beneficiaries of India’s wind energy and hybrid renewable build-out. MOSL has a price target of Rs 74.

About Suzlon Energy

Suzlon Energy is a provider of renewable energy solutions. The  company is a producer of wind turbines. It offers a range of solar energy solutions, such as solar irradiance assessment, land acquisition and approvals, infrastructure and power evacuation, supply chain, installation and commission and life cycle asset management.