Suzlon Energy shares rise for the third consecutive day ahead of MSCI reshuffling

Sonali Saha
4 Min Read

Suzlon Energy’s stock exhibited positive momentum, rising by 1.12% to reach Rs 38.84 on the BSE. This marks the third consecutive day of gains, following a 1.13% increase during Sunday’s Muhurat trading and a 1.77% rise on the preceding Friday. The upward trend is attributed to anticipation surrounding the MSCI rebalancing scheduled for November 14, where Suzlon Energy is perceived as having a high likelihood of inclusion in the MSCI India Standard index. This potential inclusion is expected to bring approximately $180 million in passive inflows to the company.

On Monday, Suzlon’s stock continued its ascent, trading at Rs 38.84, adding to the positive momentum from Sunday and Friday. JM Financial identifies several other stocks, including IndusInd Bank, APL Apollo Tubes, Persistent Systems, One 97 Communications (Paytm), Polycab India, and Tata Communications, with a good probability of being added to the MSCI index. The brokerage suggests that Macrotech Developers (Lodha) is likely to be excluded, while AU Small Finance Bank has a low probability of inclusion.

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Furthermore, there is speculation that Suzlon Energy may transition from the smallcap to the midcap category in the upcoming January AMFI rejig. Nuvama, recognizing Suzlon as a high-conviction entrant in the MSCI index for November, adds to this speculation. The AMFI list is anticipated to be released in the first week of January, valid from February to July.

Monthly data reveals that mutual funds reduced their stakes in Suzlon Energy in October, selling approximately 13.36 crore shares for about Rs 410 crore. Despite this, the stock has seen a notable gain of 27% in November, in addition to an 18.60% rally in October.

Suzlon Energy reported a substantial 78% YoY increase in profit for the September quarter, amounting to Rs 102.29 crore. However, sales for the quarter were down nearly 1% at Rs 1,417.21 crore. The company, as stated by CFO Himanshu Mody in an interview with Business Today TV, aims to deliver the existing 1,600 MW of confirmed orders in a timely and profitable manner over the next few quarters. Suzlon Energy emphasizes being selective in accepting orders that align with its margin profile.

Analysts at JM Financial project a robust revenue and EBITDA CAGR of 38% and 43%, respectively, over FY23-26 for Suzlon. They have revised their estimates for FY25/26 upwards based on healthy order inflow, improved execution visibility, and an enhanced product portfolio. JM Financial maintains a ‘BUY’ rating on the stock with a revised target of Rs 37 per share, as of their assessment on November 3.

Ownership distribution shows that small retail investors holding up to Rs 2 lakh worth of Suzlon Energy shares owned a 24.09% stake in the company at the end of Q2. High Net Worth Individuals (HNIs) held an additional 18.85% stake, while Foreign Portfolio Investors (FPIs) accounted for a 9.66% stake during the same period.

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Hi, my name is Sonali, I am a content writer specializing in the topics of Relationships, Travel, News, Bollywood, and More.
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