Key insights on revenue, order book, and future outlook in the renewable energy market
Suzlon Energy, a prominent player in the renewable energy sector, has reported a robust performance in the third quarter of the fiscal year 2024-25 (Q3 FY25), ending December 31, 2024. The company achieved significant milestones in revenue, profit, and operational capacity, reflecting its strategic initiatives and market demand.
Financial Performance
In Q3 FY25, Suzlon Energy’s net revenue surged by 91% year-over-year (YoY) to ₹2,969 crore, up from ₹1,553 crore in the same quarter of the previous fiscal year. This substantial increase is attributed to heightened deliveries and a growing order book. The company’s Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) also saw a significant rise, reaching ₹500 crore, a 102% YoY growth from ₹248 crore. The EBITDA margin improved to 16.8% from 15.9% in Q3 FY24, indicating enhanced operational efficiency. Net profit after tax stood at ₹388 crore, marking a 91% increase from ₹203 crore in the corresponding quarter of the previous year.
Operational Highlights
Suzlon achieved record quarterly deliveries of 447 MW in Q3 FY25, a 163% increase compared to 170 MW in Q3 FY24. Over the first nine months of FY25, total deliveries reached 977 MW, underscoring the company’s capacity to meet escalating market demand. The order book has reached an all-time high of 5.5 GW, with approximately 80% comprising orders from Commercial & Industrial (C&I) and Public Sector Undertaking (PSU) customers. This shift reflects a growing trend among organizations prioritizing sustainability and renewable energy solutions.
Manufacturing and Capacity Expansion
To accommodate the increasing order volume, Suzlon has expanded its manufacturing capacity to 4.5 GW annually. The company has revamped its nacelle manufacturing facilities in Daman and Puducherry and is adding two additional production lines at its Ratlam and Jaisalmer facilities. These efforts aim to scale operations efficiently and meet the growing demand for wind turbine generators.
Product Innovation
The S144 wind turbine model continues to dominate the Indian wind market, accounting for approximately 92% (around 5 GW) of Suzlon’s overall order book. The company has successfully delivered the 300th S144 wind turbine, highlighting the model’s strong customer acceptance and Suzlon’s commitment to innovation in renewable energy technology.
Human Resources and Skill Development
Suzlon is addressing the critical talent development gap in the wind energy sector through innovative partnerships with government entities. A notable initiative is the Memorandum of Understanding (MoU) with the Andhra Pradesh Government to launch India’s largest green skill program. This program is expected to create approximately 12,000 green careers, empowering individuals with the necessary skills to support India’s transition to a sustainable energy future.
Operations and Maintenance Services (OMS)
The OMS segment remains a significant growth driver for Suzlon, consistently outperforming expectations. The company is collaborating with leading consultants to enhance field safety and optimize operational efficiency, ensuring long-term sustainable growth.
Awards and Recognition
Suzlon’s strong performance and enhanced profitability have been recognized with several accolades:
- CRISIL Ratings upgraded Suzlon’s credit rating to ‘CRISIL A’ from ‘CRISIL A-‘ with a Positive Outlook for the second time in 2024.
- The company received the Global Sustainability Award 2024 for Sustainability Excellence in Renewable Energy (Power Sector) from the Global Energy and Environment Foundation (GEEF).
- Suzlon Global Services Ltd (SGSL) was honored with the ‘Great Indian Renewable Energy Company of the Year’ award at the 3rd Sustainability Conclave.
- SGSL also received the ‘Gold Award-Green Practices’ under the Service Category at the 3rd CII-Northern Region Green Practices Award by the Confederation of Indian Industry (CII).
- Suzlon’s Wind Turbine Generator Manufacturing Businesses received six prestigious recognitions at the Frost & Sullivan IMEA Awards for outstanding performance across various units.
Market Outlook
The renewable energy sector in India is experiencing significant growth, driven by government initiatives and increasing corporate commitments to sustainability. Suzlon’s strategic focus on expanding its manufacturing capacity, enhancing product offerings, and strengthening partnerships positions the company to capitalize on these opportunities. The emphasis on C&I and PSU customers aligns with the broader market trend towards sustainable energy solutions.
Investor Considerations
Investors should note Suzlon’s impressive financial performance, marked by substantial increases in revenue, profit, and operational capacity. The company’s strategic initiatives, including capacity expansion and product innovation, indicate a proactive approach to market demands. The strong order book and focus on C&I and PSU customers suggest a stable revenue stream moving forward. However, investors should also monitor factors such as policy changes, market competition, and execution risks associated with rapid expansion.
Suzlon Energy’s Q3 FY25 results reflect a period of significant growth and strategic advancement. The company’s robust financial performance, coupled with its initiatives in capacity expansion, product innovation, and skill development, positions it well to meet the increasing demand for renewable energy solutions in India. As the renewable energy landscape evolves, Suzlon’s strategic direction and operational execution will be critical factors for investors to consider.
