Suzlon Energy shares down 15% in 8 sessions; will this 'bearish' move continue?
Shares of Suzlon Energy Ltd continued their losing run for the eighth straight session on Monday. The stock tanked 5 per cent to settle at Rs 70.98. At this price, it has declined 15.23 per cent in eight trading days. Despite the mentioned drop, the scrip has rallied 84.46 per cent in 2024 so far.
The renewable energy solution provider has received an ‘advisory cum warning’ letter from BSE and NSE. “On review of the responses and documents received from the company on the issues raised by the resigning independent director, it was identified that there seem to be few instances where better corporate governance practices could have been followed by the company,” exchanges stated.
This was about the disclosure submitted by Suzlon on June 8, 2024, concerning the resignation of Marc Desaedeleer as independent director where the resignation letter highlighted that the corporate governance standards did not meet the expectations.
Suzlon, on its part, said that the advisory/warning letter has no material impact on the financial, operation or other activities of the company.
A technical analyst said the stock looked ‘bearish’ on daily charts and may slip further. Support on the counter could be seen at Rs 70, followed by Rs 66.
Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher said the stock has recently witnessed a slide with some profit booking seen. “It has slipped below Rs 74.60 level to slightly weaken the bias. The next important support level is around the Rs 66 zone which needs to be sustained. A fall below the said range can induce a further slide. For the bias to improve, the stock needs to cross Rs 79.”
Sebi-registered research analyst AR Ramachandran said, “Suzlon Energy’s stock price is bearish on daily charts with strong resistance at Rs 76.5. A daily close below support of Rs 70 could lead to 64 in the near term.”
The counter traded lower than the 5-day, 10-, 20-, 30-day and 50-day simple moving averages (SMAs) but higher than the 100-, 150-day and 200-day SMAs. The scrip’s 14-day relative strength index (RSI) came at 33.11. A level below 30 is defined as oversold while a value above 70 is considered overbought.
According to BSE data, the company’s stock has a price-to-equity (P/E) ratio of 451.28 against a price-to-book (P/B) value of 26.78. Earnings per share (EPS) stood at 0.16 with a return on equity (RoE) of 5.95. As of June 2024, promoters held a 13.27 per cent stake in the company, which is slightly lower from 13.29 per cent in the previous quarter.
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