Suzlon‘s share price tanked early on Monday going down over 5% to hit an intraday low of ₹47.40.
What Happened: Suzlon announced that Marc Desaedeleer, an Independent Director, has tendered his resignation from the company’s board. The company informed the exchanges about Desaedeleer’s resignation on Saturday.
In his resignation letter, Desaedeleer expressed concerns regarding compliance and transparency as his reasons for stepping down. He joined the Suzlon Board in 2016.
Analyst Note: Brokerage firm Nuvama in its note reviewing the situation said that the company’s CEO clarified that the issues raised were soft in nature and process-oriented, which would be implemented in due course.
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As per the Nuvama note, the company clarified that Desaedeleer’s suggestions did not revolve around financial or operational irregularities or non-compliance with the law. Instead, they were based on his personal expectations for the company’s governance and operational pace.
Suzlon’s management continues to address the business’s needs while fully complying with regulations. Desaedeleer’s term was originally scheduled to end in September 2024.
With Suzlon turning around its financial position and anticipating an operational ramp-up in FY25, the management is prioritising the immediate needs of the business, the brokerage added.
Given the improvements in Suzlon’s financial health and the positive outlook for the wind sector, Nuvama maintained its ‘buy’ recommendation on Suzlon, with an unchanged target price of ₹53.
Price Action: Suzlon’s share price was down 4.01% to trade at ₹47.90 as the markets opened on Monday.
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