Analyst Says Suzlon Shares Could Test ₹90 Levels In Near Term And Is A 'Buy-On-Dip' Candidate

Suzlon‘s share price continued its bullish rally on Tuesday to hit a new 52-week high of ₹68.22.

What Happened: Shares of the wind energy major have been upbeat ever since the company posted its earnings for the quarter ended June earlier this month. Since then, the stock has raced over 23%.

Technical Analysts: “Suzlon has shown impressive strength on the daily charts by breaking out of a 98-day cup and handle pattern,” said Anshul Jain, head of research at Lakshmishree. He added that following the breakout, the stock consolidated for 19 days above the breakout point, forming a base-on-base pattern.

“We’ve been recommending Suzlon with a target of 65, and now that it has surpassed this level with strong volumes, we foresee it heading towards 74 and eventually 90. The stock’s volume remains robust, which adds to our bullish outlook. The only negative aspect is the 5% circuit limit, which could limit rapid movements. Nevertheless, with the recent slice above 65, Suzlon is well-positioned to test higher levels of 74 and 90 in the near term,” Jain added.

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“Over the past five months, Suzlon has been consolidating within the price range of 35-50. This phase of price stability was recently interrupted, as the stock broke out of this zone and surged, currently trading around the 68 mark,” Jigar S Patel, senior manager, technical research analyst, Anand Rathi Shares and Stock Brokers.

He added that this breakout is crucial as it indicates a shift in market sentiment. Patel further said that the bullish outlook is further supported by the monthly relative strength index (RSI), which has entered the overbought zone. This technical indicator suggests that the stock has strong upward momentum.

“Looking ahead, the 55 level is expected to serve as a solid support, providing a floor for the stock price. On the upside, resistance is anticipated near the 75 level, which may act as a cap on further price increases in the near term,” the analysts said.

“Prices are in a very long-term uptrend. The price broke out of the consolidation phase in July 2024, and in the last couple of weeks, prices have been in a runaway mode,” said Manish Shah, an independent market analyst.

He added that currently, prices are at 52-week highs but the prices may correct downward towards 54–56 from here. However, he estimates that once the correction is over, the uptrend could resume. “This stock is a buy-on-dips candidate. Investors who wish to get on board Suzlong should wait for a corrective decline. On the upside, prices may rally to 80–85 over the next couple of months,” Shah added.

“Suzlon’s stock, currently at 68.22, shows a positive trend with key resistance at 75, indicating a potential upside towards 80 if breached. Immediate support is at 65, with the next support at 62, guarding against short-term bearishness. Technical indicators and increasing volumes suggest strong bullish momentum. Overall, Suzlon is likely to move higher, but monitoring support levels is crucial,” said Riyank Arora, technical analysts at Mehta Equities.

Fundamental Analysts: After the company’s results came out Nuvama downgraded the stock to “hold” and set a target price of ₹64. The firm reasoned that while the company’s long-term prospects look bullish, the increase in order inflow and profit are already factored into the current price in the short term.

ICICI Securities downgraded the stock to “add” from “buy” with a target price of ₹70. The firm cited the sharp jump in the stock price as the reason for the downgrade.

Price Action: Suzlon’s share price was locked in 5% upper circuit at ₹68.22 on Tuesday.

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