Suzlon Energy's Order Cancellations Could Have Notional Financial Impact Of Rs 1,800 Crore
Over the weekend, Suzlon Energy Ltd. notified exchanges about order cancellations of 300 MW.
This development shrinks the company's wind turbine generator segment order book and could have a negative financial impact of Rs 1,800 crore, as per NDTV Profit calculations.
Orders Cancelled
The first cancellation was a 99 MW order from Vibrant Energy, that the company had notified the street about on May 17, 2023.
The second order that was cancelled was a 100 MW order that the company received from a leading global utility firm on Dec. 15, 2023. Both the orders were cancelled as the companies decided not to proceed with the respective projects as a whole, Suzlon said.
An order size of 201.6 MW, received on Aug. 25, 2023, has also been reduced. The original order was from O2 Power Pvt., specifically through their subsidiary Teq Green Power XI Pvt. The order size has now been reduced by half, meaning the company will only supplying turbines for a 100.80 MW project. Moreover, Suzlon Energy will now execute the order in the name of Solalite Power Pvt., instead of Teq Green Power XI.
Order Book Position
As of January 2025, Suzlon Energy's pending orders totalled 5,523 MW. As per the company's latest exchange filing, the company's order book now stands at 5,622 MW. This includes the new orders won by the company since January, as well as the cancellations and order size reduction.
However, the company has clarified that this order book figure includes the equipment that has already been shipped or dispatched during Q4 FY25. The exact details of the dispatches and their financial impact will be disclosed by the company, only when it releases its official financial results for FY25.
In 9M FY25, the company has delivered orders of 977 MW. Nuvama Research expects the company to execute 1,500 MW of orders in FY25. If we assume that the company is able to meet the brokerage's execution target for the fiscal, it would imply deliveries of 503 MW in Q4 FY25. This could entail a net order book of 5,119 MW.
Financial ImpactÂ
Suzlon Energy's management has previously indicated that the company earns an average revenue of Rs 6 crore per megawatt of order executed. Taking this number and the 300 MW of orders cancelled, the potential impact to the company's order book revenue stands at Rs 1,800 crore, as per NDTV Profit calculations.
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