Suzlon Energy Ltd. share price target

Revenue increased by 30.91% to Rs. 2548.0 Cr in Q3FY17 when compared to the previous quarter. Also, it increased by 92.47% when compared with Q3FY16.

EBITDA margin expanded by 800 bps y/y to 21.6% due to higher capacity utilization The raw material cost and other expenditure yoy increased by 80 % and 24% respectively. Staff expenditure stood at `2,555 mn( +26.6% y/y; -1.3% q/q) Depreciation was at `1094mn (+15.5% q/q; +12.2% y/y). Interest expense stood at `3391 mn (+18.6% y/y; +13.7% q/q) .This increase was mainly due to higher working capital requirement during the quarter. Consolidated net term debt (excluding FCCB)...

Suzlon Energys (SUEL?s) 3QFY17 result was a beat on all counts with volumes of 462MW ( 80% YoY) and EBITDA margins of 22.5% ( 490bps YoY) - leading to a higher-than-expected APAT of Rs 3.0bn. Improvement in EBITDA margins was led by operating leverage benefit and a favourable revenue mix (lower EPC).

Depreciation stood at `947.6mn (+13.3% q/q+23.7% y/y).Interest expense stood at `2981 mn (+7.7% y/y;-2% q/q). This decrease -q/q was mainly due to repayment of debt during the quarter. Consolidated net term debt (excluding FCCB) stood at `66460 mn; a reduction of `2300 mn q/q. Working capital debt stood at `31,930 mn Tax expense stood at `9.8 mn (-75.3% q/q). Consequently, PAT stood at `2423 mn. Total outstanding order book positition-1136 MW valued at `7,165 Cr Senvion was fully divested by Suzlon group on 29th April 2015.Hence, 2Q FY 16...

Suzlons 2QFY17 result was a beat on all counts with volumes of 353MW ( 56% YoY) and EBITDA margins of 21.3% ( 460bps YoY) - leading to an APAT of Rs 2.0bn (higher than expected). EBITDA margin improvement was led by (a) contribution from larger turbines, (b) benefit of low RM cost and (c) favorable mix (lower EPC).

EBITDA margin decreased by 620 bps q/q to 7.4% % due to lower capacity utilization The raw material cost and other expenditure q/q decreased by 56% and 29.7%...

Suzlon’s 1QFY17 volumes of 204MW (flat YoY) was below our estimates, leading to a loss of Rs 2.6bn (higher than expected). Loss could have been lower (by Rs 1.2bn) had it not been for the new Ind AS norm. With an order book of 1,205MW (to be entirely executed in FY17E), the company remains confident of meeting its FY17E volume guidance of 1.5 - 1.6 GW. The same should also aid in balance sheet healing (primarily debt reduction).

Muted order announcements, so far in FY17E, have cast pressure on the WTG stocks. However we expect the order flow momentum to pick up as most states have finalized their tariffs. Visibility on volumes over the longer run also remains high given continued government thrust, improvement in technology and expected tender based bidding in wind. In this backdrop, we reiterate BUY on Suzlon with a TP of Rs 28/share (10x FY18E EV/EBITDA).

Suzlon Energy Limited - SUZLON attended Suzlon’s analyst meet, wherein the management was confident of the wind industry’s growth in India over the next five years. The government is committed to attaining 60GW of wind power by 2022 and given the IPP-led customer profile; these targets are achievable, as per the company. It expects FY17 to be a 4.3GW market with Suzlon commanding the leader’s market share of 40-50%.HDFC Securities reiterate their BUY rating on the stock with a TP of Rs28/share (10x FY18E EV/EBITDA).

Trendlyne has 3 reports on SUZLON updated in the last year from 1 broker with an average target of Rs 28. Brokers have a rating for SUZLON with 1 price downgrade and 1 price upgrade in past 6 months.

Suzlon is a market leader in India with a global footprint across all continents. Over the past two decades, Suzlon has built and consolidated its presence in 19 countries. Suzlon is a market leader in India with 100+ wind farms with an installed capacity of ~9,000MW spread across 9 states. Suzlon's diversified client portfolio includes companies from a variety of industries, including...

Suzlons 4QFY16 volumes of 443MW (in line with our estimates) put it back in the black, with an APAT of Rs 500mn. EBITDA margin at 14.1% appears low primarily owing to the revenue mix (lower OMS contribution with increasing WTG volumes).