Suzlon Energy Shares Extend Rally For Second Day, Gain Over 9% On NSE
The exchanges said that they may take any non-compliance with governance standards seriously.
Suzlon Energy Ltd. share price jumped over 9% on Wednesday, a day after the company's price band was revised to 10% from 5% previously. This means the stock can now move up to 10% in either direction during a session.
Opening higher at Rs 74.59 apiece on the NSE, the stock gained 9.2% to hit an intraday high of Rs 80.45 apiece.
The stock had closed nearly 4% higher on Tuesday after declining over 6.5% during the session's trade.
The revision of Suzlon Energy's price band comes after the stock was removed from the Surveillance Measure (ASM) framework. It was excluded from the Stage 1 ASM on September 20.
The removal of a stock from the ASM Framework suggests concerns about manipulation or volatility of the stock have decreased.
Shares of Suzlon Energy had been on a losing streak over eight sessions till Monday at trade after it received an “advisory cum warning letter” from the BSE and NSE.
On October 1, Suzlon Energy informed the exchanges about the advisory cum warning letter. The exchanges voiced their concerns over the company's corporate governance practices after the resignation of independent director, Marc Desaedeleer. The exchanges said that they may take any non-compliance with governance standards seriously.
The resignation letter of Marc Desaedeleer stated that “corporate governance standards applied by the company did not meet the expectations, including situations where communications lacked the level of openness and transparency."
Despite the recent losses, the stock has gained over 180% in the last one year. The stock has continued to perform well in 2024, increasing investors’ wealth by over 105% year-to-date.
In a recent note, brokerage house Nuvama Alternative Research estimated that Suzlon Energy Ltd. could be re-classified as a large-cap stock in February 2025 by the Association of Mutual Funds in India (AMFI). The stock is currently classified as mid-cap with a threshold of Rs 27,500 crore.
Suzlon Energy shares were trading 8.16% higher at Rs 79.65 apiece at 11:23 am on the NSE against the benchmark Nifty 50’s rise of 0.83%.
The multibagger stock has risen 106.39% year to date and 185.21% in the past 12 months. Total traded volume in the session so far stood at 1.37 times the 30-day average. RSI for the counter was 51.66.
Two out of the five analysts tracking the company have a 'buy' rating on the stock, and three suggest a 'hold', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 6.6%.
