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Suzlon Energy hits 52-week low on disappointing Q1 numbers

According to reports, Suzlon Energy Ltd slipped nearly 7 per cent in early trade on Tuesday to hit its 52-week low of Rs 16.35 after the wind turbine maker reported a standalone net loss of Rs 696.64 crore for the first quarter ended June 30 due to lower volumes, adverse market mix, high interest burden and notional forex losses.

In the same quarter a year ago, the company reported a net profit of Rs 137.83 crore.

At 09:45 a.m., Suzlon Energy was trading 4.2 per cent lower at Rs 16.95. It has hit a low of Rs 16.35 and a high of Rs 17 today.

The company reported a huge consolidated net loss of Rs 849 crore against a profit of Rs 60 crore in the June 2011 quarter.

The current quarter’s performance is unlikely to gel well with investors, and analysts fear the stock may underperform the markets in the coming few days.

“In the run-up to the results of wind turbine maker Suzlon Energy for the quarter to June, investors may have been carried away by the company’s recent success in bringing around bankers to agree to a $281 million loan to help it repay $360 million to bond holders,” ET reported.

“A meagre 9 per cent growth in revenue failed to compensate for the 29 per cent rise in expenditure, significantly impacting Suzlon’s EBITDA margins (excluding other income) from 11.2 per cent in the June 2011 quarter to -5.4 per cent in the June 2012 quarter. The company reported a consolidated net loss of Rs 849 crore for the quarter,” the report added.

Shareholding of foreign institutional investors has also dropped from 10 per cent in the March 2012 quarter to 5.5 per cent by the end of the June 2012 quarter.

This is by far the lowest shareholding of foreign portfolio investors in this company till date, a sign of waning investor confidence.

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