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Tania Kishore Jaleel

Mumbai, Aug. 28 Even though there have been reports of complaints against Suzlon Energy’s products, marketmen still believe that there is a lot of value in the scrip. The share price of the company fell close to eight per cent during the last week, on reports that its domestic clients were having technical problems with its turbines.

Reports stated that the turbines “failed to generate expected electricity, suffer from excessive vibrations during high winds and control problems, costing them millions of dollars in revenue.” Some brokerages have re-rated the company due to this.

A stock broking firm which, at the beginning of the month, had recommended a ‘buy’ on the stock, changed its rating to ‘reduce’, stating that the stock was ‘richly valued’ and there were concerns regarding its products and orders.

But, most of the other brokerages are of the view that this report does not pose as a serious threat to the company. “This will not pose as a big problem for the company as they have made provisions in their accounts to take care of this. And also the stock is available at very cheap valuations at the moment,” said a research analyst with a stock broking firm.

The stock gained 1.64 per cent today on the BSE to close at Rs 208.15, analyst feel that the stock is at an ‘oversold position’ at the moment and see good value in the stock. The volumes traded in this stock are also quite high. Today total number of Suzlon shares traded on the BSE amounted to 18.8-lakh shares against its two week daily average of 14.8-lakh shares.

A recent Enam Research report had given the stock an ‘outperform’ rating compared with the ‘underweight’ rating that it had given for other stocks in the engineering sector.

Indiabulls in its latest report has changed its rating from ‘hold’ to ‘buy’. The brokerage has re-rated the company due to the company’s good valuation, effective cost management and the expectation of an increase in the order book from the US. “What with the high crude prices, there will definitely be an increase in the demand for alternative energy. This is another good thing for Suzlon,” said Mr Sanjay Someshwar, a sub-broker with Ventura Securities.

More Stories on : Stocks | Non-conventional Energy | Suzlon Energy Ltd

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