With ‘A-’ CRISIL Rating, Suzlon Shares Surged 4% on Reflection of Financial Strength

With ‘A-’ CRISIL Rating, Suzlon Shares Surged 4% on Reflection of Financial Strength

Suzlon Group, India’s premier producer of renewable energy solutions, has received a major credit rating improvement from CRISIL. CRISIL upgraded Suzlon’s rating to ‘A-‘ with a Positive Outlook on March 27, 2024.
CRISIL Ratings raised its rating on Suzlon’s bank facilities to ‘CRISIL A-/Positive/CRISIL A2+’ from ‘CRISIL BBB+/Positive/CRISIL A2’.

Himanshu Mody, Chief Financial Officer of Suzlon Group, said, “We are delighted with the bank facilities rating upgrade by CRISIL, which is aligned with our efforts to achieve financial flexibility, and indicative of the robust financial position of the company. Achieving this milestone reflects our continuous focus on sound financial management, operational excellence, and sustainable growth.”

Suzlon Energy stocks rose 4.07 percent to ₹38.60 on March 27 at 11:51 a.m. on the BSE. The company has a market valuation of ₹51,128.20 crore. Suzlon energy’s stock price is still more than 20% lower than its 52-week high of ₹50.72.
Suzlon’s stock price has recently fluctuated due to market concerns over the Ministry of New and Renewable Energy’s (MNRE) possible return to “reverse auctions” for wind power capacity allocation. While this regulatory adjustment may have a short-term impact on profitability, Suzlon’s long-term prospects remain positive.

Earlier this month, SEBI’s chairperson, Madhabi Puri Buch, expressed worries about stretched valuations in small- and mid-cap stocks, highlighting the risks connected with their sustained run. Her warning about the bubble in small and mid-cap stocks, which indicated off-the-charts valuations and likely price manipulation, aided the rapid drop in small-cap equities, notably Suzlon Energy.
The rating improvement emphasized Suzlon’s achievements, particularly its improved margins in the wind turbine generator (WTG) market.CRISIL also underlined the company’s sustained excellent cash flow production from operations and maintenance (O&M) services, together with a growing order book that gives strong visibility for future revenue streams.

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