Is Suzlon a turnaround story after FY16

(rvetri) #294

The 60GW target for wind i thought was additional, without adding what we
did till 2014.

The wind or solar addition depends on the auction price… Which ever is
lower, states will decide to go for that renewable… Irrespective of
centers targets… The challenge will be on solar rooftop target of

(pkk123) #295

SunEdison went bankrupt and nothing happened to Solar industry.

(Nolan) #296

Dear PKK, I know there is no threat to either Suzlon or wind energy sector. I was only mildly concerned with any short-term knee jerk reaction to Suzlon’s shares like the one we had after Inox Wind’s Q417 result.

(Nolan) #297

@rvetri - dear @Mehnazfatima is correct in saying that 60GW is a total aggregate target till 2022. Little over 30GW is already done. And I agree that the pace at which they are going, and the intentions shown so far, it seems that India would most likely exceed the target by 10 to 20 percent.

(pkk123) #298

That is only the govt. target. If Wind Power becomes viable, which it almost is, private producers can also set up Wind plants for own use or selling captive power on exchange.

(amitsoni) #299

Please find my analysis on Suzlon attached…

What is not mentioned here is

  1. Solar is definitely there and has more visibility and thats the reason govt has its target of 60 GW wind and 125 GW solar by 2022. So solar being in prominence does not take away the sheen from wind

  2. Suzlon global Services the subsidiary of suzlon is earning 1800 cr of revenue currently with 17 GW under management. These assets under management are supposed to increase yearly by 10-12% with more commissioning being done. Suzlon has an almost 100% renewal record. This subsidiary has a strong visibility of revenue and profits for next 20 years. 20 years being the age of wind mills. And hence would be valued at a high price revenue multiple. Expect the valuation of this around 8000 cr. Another forging subsidiary would be valued around 1000 cr… So in total two subsidiaries valued around 9000 crores and suzlon is available at valuation of 10000 cr.

Suzlon - the elephant rising.pdf (472.4 KB)

(Mehnazfatima) #300

The wind turbine manufacturers association says that only 228 mega watts were installed in Q1. Therefore, Suzlon installation may be around 100-125mw, which will not be enough for the company to have a positive eps for Q1.

If we go by the above news item, then Q2 too may not be to the liking of the market. Looks like what the mngt of Inox wind had predicted about there being no installation in Q1 and Q2 is turning out to be correct.

It is quite pissible for the stock to go down after Q1 results.

Those who have read The Dhando Investor by Mohnish Pabrai would do well to remember that the best investment opportunities arise when sectors with good future prospects suffer short term hicups. If Suzlon falls in the next 2 quarters, that would be a very good investment opportunity. Even the Wind Turbine manufacturers association agrees that the situation will be much better from the next financial year onwards…

(amitsoni) #301

I am surprised, this guy being a veteran in the industry does not have idea of two 500 MW tenders (TN and Gujarat) closing in another 15 days. He categorically says that there are no state tenders when in fact 1 GW tenders a re there… Total we see 3 GW tenders… I am sure more would be coming in few days… It’s not even 6 months into the fiscal year. Suzlon already has a backlog of 1700 MW… before these 2 GW tenders. Not sure about other players… Any idea… who won the tender’s for last february auctions ?

(Nolan) #302

Q1 is generally a slow quarter for wind energy sector. After a phenomenal Q417 , it is not a surprise that with GST and regime change, the industry would like to take a breather. Although, I must say that 228MW in Q1 is still quite a shocker, but 1000MW target for 17-18 seems an exaggeration. The article looks to me like a pressure tactic being used by wind turbine manufacturers to force Ministry to come in action. Govt is already on its way to open SECI and state govt. tenders in a month or two. I do not think anything less than 4000MW this year is a fair estimate keeping in mind that Govt would not like to take their foot off the peddle towards its target.

However, one thing is clear that even Suzlon is facing challenges in executing FIT orders and it wants the Ministry to put pressure on State Govts to honor the signed PPAs. There is still no confirmation on which way the pendulum would swing on Suzlon’s orderbook. The uncertainty is taking its toll on Suzlon’s stock but its hard to say how much further downside is left because the stock has hardly moved after fantastic Q417 results despite high expectations.

(Nolan) #303

Mytrah, Ostro, Inox, Sembcorp and Adani got orders. First 4 got 250MW each, and Adani got 50MW. Suzlon gor 250MW through their client Sembcorp.

(pkk123) #304

Good report. I have also been saying for a while that India will be a 10GW per annum wind market. Once that happens, Suzlon can win big. Even in the worst case, I think there is virtually zero chance of losing money in Suzlon.

(Mehnazfatima) #305

Thats how invedtment opportunities arise…

(maheshkumar) #306

suzlon leader in world wide market

today or tomorrow market will realise it and will rerate suzlon

time horizon for this is unknown

(maheshkumar) #307

everyone is optimistic about the renewable energy except mr market

(maheshkumar) #308

looks like a good trigger for suzlon

(kartik.jajal) #309

(msandip) #310

Bad sign for the industry…

(amit anam) #311

Overall power tariff falling :

(pkk123) #312

You find what you go looking for:

(kartik.jajal) #313

Suzlon rating update by CARE, positive move toward debt reduction.