Suzlon Energy shares hit 5% lower circuit after 7 days non-stop rally

Suzlon Energy hit a 5% lower circuit at Rs 17.5 in Wednesday's intra-day trade ahead of the board of directors' meeting on Friday, 7 July, to consider and approve the capital raise within a year of rights issue. Before hitting today's lower circuit, the stock rallied 35% in the last seven days. «A meeting of the Board of Directors of the Company will be held on Friday, 7 July 2023 to consider and approve capital raising by way of one or more or combination of permissible methods, and seeking approval of the shareholders, if required,» Suzlon Energy said in an exchange filing on Tuesday.

On a year-to-date basis, the stock advanced 63%, whereas, in the last month, it has risen over 52% and has rallied over 185% in the past year. Domestic brokerage firm ICICI Securities believes that Suzlon Energy is best equipped to benefit from industry tailwinds and expects a sharp uptick in earnings from FY24 onwards. ICICI Securities initiated a Buy rating on Suzlon Energy with a target of Rs 22, an upside potential of 26% from the current market prices.

The brokerage firm stated in its recent report that India has launched a series of policy initiatives like single-stage closed bidding (vs reverse e-auction), 10 GW of wind auction per annum, wind-specific RPOs, etc. These policies are likely to generate tailwinds for the industry, and Suzlon Energy is best suited to reap the benefits of the same. Technically, Suzlon Energy's day RSI (14) is at 80.9.

The RSI below 30 is considered oversold, and above 70 is overbought, Trendlyne data showed. MACD is at 1.2, above its center and signal Line, a bullish indicator. In Q4FY23, the company posted a consolidated net profit of Rs 320 crore.