Suzlon Energy Ltd Drops 3.89%: 7 Key Factors Behind the Weekly Decline

23 February 2026: Fresh 52-Week Low Despite Sensex Gains

Suzlon Energy’s share price declined to Rs.44.24, down 0.43% on the day, marking a new 52-week low. This occurred even as the Sensex rose 0.39% to 36,817.86, highlighting the stock’s underperformance relative to the broader market. The stock has been trading below all key moving averages, signalling persistent downward pressure. Despite this, Suzlon’s return on equity remains robust at 40.4%, and the company reported strong profit growth of 176% over the past year. However, valuation concerns persist with a high price-to-book ratio of 7.7, contributing to cautious investor sentiment.

24 February 2026: Continued Decline and Derivatives Market Activity

The stock fell further to Rs.44.14, another 52-week low, down 0.23% on the day, coinciding with a broader market pullback where the Sensex dropped 0.78%. Notably, Suzlon’s derivatives segment saw a sharp 10.4% increase in open interest, rising to 77,487 contracts, alongside a daily traded volume of 32,885 contracts. This surge in open interest amid falling prices suggests increased bearish positioning by market participants. The futures segment alone accounted for a value of approximately ₹77,217 lakhs, with options notional value exceeding ₹5,757 crores, indicating significant speculative and hedging activity. The stock’s technical setup remained weak, trading below all major moving averages.

25 February 2026: Five Consecutive Days of Decline and New 52-Week Low

On 25 February, Suzlon Energy’s stock price dropped to Rs.43.20, down 2.13% on the day, marking a fresh 52-week low and extending a five-day losing streak with a cumulative decline of approximately 6.9%. This underperformance was sharper than the renewable energy sector’s 2.45% decline. The stock remained below all key moving averages, reinforcing the bearish technical outlook. Meanwhile, open interest in derivatives rose by 10.1% to 52,007 contracts, with futures volume at 22,212 contracts and options notional value exceeding ₹7,067 crores. Delivery volumes increased by 15.23%, suggesting some long-term investor accumulation despite price weakness. The company’s fundamentals remain strong, with a six-month PAT growth of 193.76% to Rs.1,724.72 crore and a return on capital employed of 28.23%, but valuation concerns persist with a high P/B ratio of 7.7 and a Mojo Score of 37.0 (Sell).

Valuation Shifts and Comparative Sector Analysis

During the week, Suzlon Energy’s valuation metrics showed subtle improvement, with the price-to-earnings ratio moderating to 18.63 from previously higher levels, shifting the stock’s rating from 'very expensive' to 'expensive'. Despite this, the price-to-book ratio remained elevated at 7.66, and enterprise value multiples such as EV/EBIT at 24.52 and EV/EBITDA at 21.69 indicate a rich valuation. Compared to sector peers like Waaree Energies (P/E 24.01) and Premier Energies (P/E 26.43), Suzlon’s valuation appears relatively more attractive but still expensive. The company’s long-term returns remain impressive, with gains of 442.16% over three years and 823.82% over five years, far outpacing the Sensex. However, short-term price performance has been weak, with a 4.3% decline over the past week and a 16.13% drop year-to-date.

27 February 2026: Week Closes at New 52-Week Low Amid Market Downturn

The week ended with Suzlon Energy’s stock closing at Rs.42.70, down 1.32% on the day and marking another 52-week low at Rs.42.45 intraday. This decline occurred alongside a broader market downturn, with the Sensex falling 1.16% to 36,322.56. Suzlon’s performance contrasted with some sector indices such as the S&P BSE Oil & Gas, which reached new highs, underscoring sector-specific challenges. The stock remains below all key moving averages, reflecting sustained bearish momentum. Over the past year, Suzlon’s stock has declined by 17.83%, while the Sensex gained 9.64%. Despite this, the company’s return on equity remains strong at 40.4%, and profitability metrics such as PAT growth and ROCE continue to impress. Institutional holdings stand at 32.97%, indicating significant investor interest despite recent price weakness.

Daily Price Comparison: Suzlon Energy Ltd vs Sensex (23-27 Feb 2026)

Key Takeaways

Positive Signals: Suzlon Energy continues to demonstrate strong fundamental performance with a return on equity of 40.4%, profit after tax growth of 193.76% over six months, and a return on capital employed of 28.23%. The company’s conservative capital structure with zero debt and significant institutional holdings (32.97%) provide financial stability and investor confidence.

Cautionary Signals: The stock’s persistent trading below all major moving averages and multiple fresh 52-week lows indicate sustained bearish momentum. Valuation remains elevated with a price-to-book ratio near 7.7 and a Mojo Score of 37.0 (Sell), reflecting market concerns. The sharp increases in derivatives open interest amid falling prices suggest growing bearish sentiment and potential for further downside volatility.

Market Context: Suzlon’s underperformance relative to the Sensex and sector indices highlights sector-specific challenges in heavy electrical equipment and renewable energy. Despite strong earnings growth, the stock’s rich valuation and technical weakness have weighed on price performance.

Conclusion

Suzlon Energy Ltd’s share price decline of 3.89% over the week, culminating in a close at Rs.42.70, reflects a complex interplay of strong operational fundamentals and persistent valuation and technical headwinds. The stock’s multiple fresh 52-week lows and elevated price-to-book ratio underscore market caution despite robust profitability and growth metrics. Increased derivatives activity and open interest signal heightened bearish positioning, suggesting that near-term price volatility may continue. Investors and traders should closely monitor sector developments and valuation trends as Suzlon navigates a challenging market environment marked by sector pressures and broader market fluctuations.

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