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FY31 growth roadmap reinforces long-term growth visibility

* We attended Suzlon Energy's (SUEL) Investor Day, where management outlined an ambitious FY31 vision focused on scaling the company beyond its core wind business into a broader renewable energy platform.

Key targets include:

* revenue growth of over 25% CAGR,

* expansion of its Indian wind market share to over 40% (from ~33% currently),

* achieving a 15% market share in the solar and BESS segments,

* scaling its renewable energy (RE) order book from 5.5GW now to 15GW,

* increasing annual RE sales from 2.5GW now to 10GW,

* expanding its RE Operations & Maintenance Services (OMS) assets under management (AUM) to over 70GW from ~18GW currently.

* strengthening international presence, with over 3GW of export volumes contributing ~15% of revenue.

* Our view: We believe SUEL’s Investor Day addressed key medium to longterm growth concerns by outlining a clear roadmap for expansion and diversification into adjacent renewable energy verticals, which enhance earnings resilience. While the strategic direction is encouraging, investors are likely to remain focused on execution, capital allocation discipline, and the trajectory of working capital and leverage metrics. We believe SUEL continues to stand out as the most credible and investible player in the Indian wind space, supported by its strong market position and consistent track record of meeting execution and operational guidance.

* We reiterate BUY with a TP of INR65.

India's renewable growth story has the wind in its sails

* Global wind share at 13%; India stagnant at ~10%: Wind’s share in global installed power capacity has risen to 13% now from ~9% in 2020. In India, although absolute capacity has grown to 56GW at FY26-end (39GW at FY21- end), its share in the total installed capacity has been stagnant at ~10%.

* India’s wind capacity to cross 100GW/400GW by FY30/FY47: According to Central Electricity Authority (CEA) estimates, India’s installed wind capacity is expected to exceed 100GW by 2030 (translates to annual wind additions of 10GW till 2030). Other agencies like The Energy and Resources Institute (TERI) and International Energy Agency (IEA) project higher wind capacity by 2030, in the range of 120-160GW. Long-term estimates for India’s wind capacity are 155GW/400GW by FY36/FY47.

* Wind-Solar-BESS delivers superior economics: With a growing share of Firm and Dispatchable Renewable Energy (FDRE) and Round-the-Clock (RTC) tenders, wind is expected to play an increasingly important role, as WindSolar-BESS projects offer a more cost-effective solution for dispatchable renewable energy than Solar+BESS-only configurations. This is reflected in recent tariff discoveries, with Wind-Solar Hybrid (Peak supply) projects at ~INR3.35/kWh compared with ~INR6.27/kWh for Solar+BESS only FDRE projects. The complementary generation profiles of wind and solar reduce storage requirements, lowering the overall cost.

Suzlon 2.0 to transition SUEL into a full-stack renewable solution provider

* Suzlon 2.0 strategy focused on integrated RE solutions: Under its Suzlon 2.0 roadmap, the company aims to evolve beyond a pure-play wind OEM by offering end-to-end RE solutions. Key strategic pillars include becoming a one-stop provider for customers' RE requirements through integrated Wind + Solar + BESS solutions, acting as a lifetime service partner across the renewable energy asset lifecycle, and delivering globally competitive products leveraging worldclass technology, localized engineering capabilities, and India's cost-efficient manufacturing base.

* High localization provides a strategic advantage: The Indian wind industry currently operates with ~60% localization levels, whereas SUEL has achieved 80- 85% localization across its value chain. This enhances supply chain resilience, reduces dependence on imports, and positions the company favorably amid an increasingly volatile global trade and geopolitical environment.

* Repowering presents a long-term growth opportunity: SUEL is currently executing three pilot repowering projects with customers in India. These projects are expected to demonstrate the potential for ~50% improvement in energy generation at existing wind sites, thereby unlocking significant value from existing wind-rich locations.

* Expanding product portfolio: SUEL recently launched its 5MW turbine platform (Blue Sky), designed for international low-wind-speed sites, with the first installation completed in May’26. The company is also developing the S163 (6MW) turbine, targeted at mid-to-high wind speed locations with 1st turbine installation expected in 1HFY27.

* Deviation Settlement Mechanism (DSM) regulations create opportunities for value-added service offerings: With deviation penalties for wind generation reduced to 10% under the evolving DSM framework, accurate forecasting and scheduling capabilities are becoming increasingly important. Suzlon is investing in wind resource assessment, AI-driven forecasting, and scheduling solutions, which are expected to help customers optimize generation profiles and mitigate DSM-related risks before the regulations become fully applicable.

Suzlon 2.0 sets an ambitious target of 15% of FY31 revenue from exports

* Globally, ~165GW of new wind capacity was added last year, providing a large addressable market for turbine manufacturers.

* Europe is expected to reach 2,000GW wind capacity by 2030. It is viewed as an ideal export market, given its relatively favorable geopolitical relations, a strong policy focus on the green transition, and the presence of some of the world’s largest renewable energy developers, access to whom is expected to offer SUEL a meaningful global scale. Annual wind capacity addition demand of ~18GW is expected alongside a sizeable repowering opportunity of a similar magnitude of 18-20GW.

* On the back of this expanded product portfolio and the European repowering opportunity, SUEL is targeting an export order intake of over 3GW by FY31, with exports contributing 15% of overall revenue by that year.

Valuation and view

* We arrive at our TP of INR65 by applying a target P/E of 27x to FY28E EPS.

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