Suzlon 1.0 was a disaster. There was so much of promise and hope but it all resulted in series of wrong strategic moves, lots of debt and huge losses. The stock price was Rs. 424 in Jan 2008 and then it touched Rs. 6 in September 2013. That was the scale of disaster. But it looks like Suzlon is ready to move on and reinvent itself with its 2.0 version and a new investor Dilip Sanghvi, India's second-richest man.
As per Deal Curry
Dilip Sanghvi, the founder and MD of country’s most valuable pharma company Sun Pharmaceutical, is picking up 23% stake in Suzlon Energy for R1800 Cr. Suzlon would be making an allotment of a billion shares to the Dilip Sanghvi Family and Associates at a unit price of Rs 18.
Suzlon as a company has been in deep trouble for long. The company made lots of wrong strategic moves and is currently deep in debt with huge losses. The big question: Why Dilip Sanghvi is making huge commitment (picking 23% stake in Suzlon)? And considering Dilip Sanghvi impressive track record with Sun Pharma, can we assume something similar here. Well, we don't know. But we all know how investing works. You follow great people, their business instincts and leadership style.
This is how Suzlon stock reacted today -
Why I am calling 2.0? Because people are going to look at Suzlon differently and that's going to make huge difference to the company and its stock price. It means a stock that was avoid till date will now become active buy on declines even for institutional investors. This is Suzlon stock daily chart
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers