Eyeing new growth frontiers
Suzlon has gained substantial ground in India’s wind power space over the last three years. As a vertically integrated wind energy solutions provider with highly localised manufacturing, its growth has been synonymous with India’s wind power growth. Wind remains a key piece in India’s RE capacity addition plans, gaining higher traction in recent times due to the country’s focus on hybrid/FDRE capacity. The sectoral tailwinds reflect in Suzlon’s order book (OB), which swelled to 6.4GW, as of Jan’26. With its existing wind business exhibiting strong potential, Suzlon is now eyeing new, yet related, frontiers. It has announced a major leadership restructuring as part of its ‘Suzlon 2.0’ vision, aiming to transform into a full-stack, diversified renewable energy solutions provider. The new management structure is designed to expand into project development across wind, solar and BESS, while Suzlon maintains its stronghold in the existing wind business.
Outlook and valuation
Suzlon is back in shape after a tumultuous period over the last decade. Over the past three years, the company has pared its debt from INR 120bn in FY20 through various debt to equity conversions. With that, it became net cash positive with a cash reserve of INR 13bn, as of Sep’24, after a successful equity raise worth INR 20bn in Q2FY24 for debt reduction. Since then, Suzlon has improved its cash position significantly.
Moreover, major positive changes in regulatory policy and eventually on business front bode well for the wind industry. The government has decided to tender out at least 10GW of wind capacity every year, with the pick-up in demand from commercial and industrial entities for round-the-clock power supply. Suzlon, being the market leader in the wind turbine industry, is a natural beneficiary of this shift, in our view.
Outlook for the wind industry is positive over the medium to long term, given India’s RE and wind capacity targets. Also, given the increasing complexity of RE power projects (from plain vanilla solar or wind to hybrid, RTC and FDRE), we believe wind may play a crucial role in RE generation going ahead.
The company’s OB, as of Jan’26, stood at ~6.4GW, which is 4.1x its FY25 wind turbine delivery volume. Thus, owing to the strong order backlog and positive outlook for OI, given India’s RE targets, we remain positive on the stock.
We reiterate BUY, with an unchanged target price of INR 65, valuing the business at 32x FY28E EPS.
