Suzlon Energy shares rise 118% in three months; more upside ahead?

Shares of renewable energy firm Suzlon Energy Ltd have delivered 118% returns for investors in the last three months. The stock, which closed at Rs 8.63 on May 5 rose to an intraday high of Rs 18.78 on BSE today, clocking a gain of 117.61% during the period. Suzlon Energy stock rose for the second consecutive session today .The stock snapped its two-day losing streak on Friday, rising 5% intraday on BSE. Suzlon Energy stock rose to Rs 18.78 against the previous close of Rs 18.39 on BSE. Market cap of Suzlon Energy stood at Rs 22,831 crore. A total of 104.63 lakh shares changed hands amounting to a turnover of Rs 19.31 crore on BSE.

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In terms of technicals, the relative strength index (RSI) of the Suzlon Energy stock stands at 56.2, signaling it's trading neither in the overbought nor in the oversold zone. Suzlon Energy shares have a beta of 1.6, indicating very high volatility in a year. Suzlon Energy stock is trading higher than the 20 day, 50 day, 100 day and 200 day but lower than the 5 day and 10 day moving averages.

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Abhijeet from Tips2trades said,"Suzlon Energy is bearish on the Daily charts with next resistance at Rs 19.4. Investors should book profits at current levels or hold till Daily support of Rs 17.7 is broken on a closing basis."

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Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher said, “The stock has picked up well from Rs 8 levels and recently found consolidation near the Rs 17-18.50 zone after it touched the high of 20.80 levels. The near term support is maintained near Rs 17 level and above Rs 20.80, a fresh breakout would be indicated for further upside targets of Rs 26 and Rs 34 levels.”

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Osho Krishan, Sr. Analyst - Technical & Derivative Research at Angel One said, “Suzlon has massively soared more than two times in the current financial year on the back of robust volumes. On the technical chart, the stock has witnessed several pivotal breakouts and currently hovering at new 52-week highs. The recent rally was vertical in nature, which snubbed in between price-wise corrections. The technical parameters indicate the counter is in the over-bought territory and one should not be carried away with the ongoing momentum. As far as levels are concerned, a series of support is placed around Rs 17 odd zone on an immediate basis, followed by sacrosanct support of Rs 14-15. On the flip side, a substantial hurdle could be seen around the Rs 20-24 zone in the comparable period.

Manoj Dalmia, CEO of Proficient Equities said, “Despite the company's reduced debt, it faces challenges with a low interest coverage ratio and high borrowing costs. Risk-averse investors are advised to refrain from purchasing at current levels, instead considering buying above Rs 21. On the other hand, those with a higher risk appetite may consider purchasing with a tight stop loss, as a close above Rs 21 could potentially drive the stock to Rs 30. The company's prospects appear promising, as the board has approved a capital raise of Rs 2000 cr through QIP to repay debt. Nevertheless, investors should diligently monitor fundamentals and remain vigilant for any potential red flags moving forward.”

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The firm announced its Q1 earnings on July 25.

Suzlon Energy reported a 96 per cent fall in consolidated net profit at Rs 101 crore in the April-June quarter against a consolidated net profit of Rs 2,433 crore in the year-ago quarter. The company's net revenue in the first quarter of this fiscal also fell to Rs 1,348 crore from Rs 1,378 crore in the year-ago period.

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.

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