- Suzlon faces headwinds in new orders and execution, says Morgan Stanley
- Morgan Stanley notes lower bidding activity in renewables this fiscal year
- Suzlon reported a 15% rise in Q3 net profit to Rs 445 crore
Shares of Suzlon are in focus on Monday after Morgan Stanley came out with an important note on the counter, notably downgrading its stance while considerably reducing the target price.
In its latest note, the global brokerage firm has pointed out that there are significant headwinds for Suzlon going forward, particularly when it comes to new orders and execution.
The risk to order inflows emanates from concerns that the renewable push might be cooling off. Morgan Stanley notes that bidding activity in the renewable space has already been significantly lower in the nine months of the ongoing financial year.
If it continues to taper off, Suzlon could run the risk of losing its momentum when it comes to order book growth. Moreover, there are risks to execution in what has become an increasingly competitive sector.
This comes on the back of Suzlon's third-quarter earnings for the financial year ending March 2026, where the company reported a consolidated net profit of Rs 445 crore, compared to Rs 389 crore in the year-ago period, accounting for a 15% increase.
Revenue from operations soared 42% to Rs 4,228 crore versus Rs 2,986 crore last year. Operational performance improved as earnings before interest, tax, depreciation and amortisation jumped 48% to Rs 731 crore from Rs 493 crore in the corresponding quarter last year. Margin expanded to 17.3% versus 16.6%.
The company's orderbook stood at 6.4 gigawatt and reported the highest-ever quarter deliveries at 617 MW. Suzlon has 2.4 GW of execution projects underway.
The firm adds that execution challenges for the renewable energy developers could pose a risk of slower offtake for Suzlon turbines.
Keeping these factors in mind, Morgan Stanley has downgraded Suzlon from 'overweight' to 'equal-weight' while reducing the target price from Rs 78 to Rs 52.
READ MORE: Suzlon Energy Q3 Results: Profit Up 15%, Revenue Surges 42%
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