Suzlon Energy Ltd's market share level will be in focus today (August 18) after the renewable energy stock rallied nearly 5 percent in the last trading session. The stock had already gained more than 5 percent on Monday, on the back of what has been suggested as changes in grid connectivity rules that could give renewable energy developers more time to accomplish certain project targets.
Suzlon Energy shares rose 4.64% to ₹49.30 on the BSE. That was despite the weak broader market as Sensex slipped 281.09 points to 77,728.16 and the Nifty 50 dropped 78.35 points to 24,287.65 yesterday.
Another renewable energy stock, Inox Wind, also gained strongly, rising 6.10% to ₹78.20.
The developments have brought renewable energy stocks back into focus as investors assess the potential impact of the reported regulatory changes on project execution.
Suzlon share price: ₹51.20 resistance at present
From a technical perspective, traders are watching the ₹51.20 level as the first major resistance for Suzlon Energy.
The stock has recently found buying support in the ₹46-₹47 range and subsequently bounced higher.
If Suzlon can decisively cross the ₹51.20 resistance level, then the next hurdle might be around ₹55-₹56.50.
A sustained move above ₹56.50 could potentially bring the ₹60–₹62 zone into focus.
On the downside, ₹46–₹47 is an important support area. A decisive break below this range would weaken the recent recovery and increase selling pressure.
Key Suzlon technical levels
Level Zone Significance
- Resistance 1 ₹51.20 Immediate hurdle.
- Resistance 2 ₹55–₹56.50 Next major resistance.
- Resistance 3 ₹60–₹62 Potential upside zone.
- Support ₹46–₹47 Key downside support
These levels of technical parameters are based on the recent price movements and market analysis. They are not guarantees of future returns.
Why did Suzlon shares jump?
Recently, the energy stocks of renewable energy had rallied on a report on grid connectivity requirements of renewable energy projects.
According to that framework, renewable energy developers may be able to seek additional time to meet certain project milestones by paying daily charges.
The charges are ₹1,000 per MW per day for delays in land acquisition and financial closure. Commercial operations can lead to a higher charge of ₹3,000 per MW per day.
The proposed framework can be extended to up to:
- Three months for land-related requirements.
- Six months for financial closure.
- 12 months for project commissioning.
But projects that do fail to meet the new deadlines may still suffer grid connectivity loss and bank guarantee.
Why are grid connectivity rules important?
Grid connectivity is an essential part of renewable energy projects. Developers need access to the transmission network to evacuate electricity generated by wind and solar projects.
Delays in land acquisition, financing, transmission infrastructure, and project commissioning can affect the timelines and economics of renewable energy projects.
Consequently, giving developers more time, subject to financial charges, could provide greater flexibility to projects facing execution delays.
Investor sentiment in companies like Suzlon Energy and Inox Wind may be affected by regulatory policies that affect the pace of renewable project development.
Renewable energy sector remains in focus
India's renewable energy aspirations continue to keep investors’ interest in renewable energy in the sector very much on the minds of investors.
The country is targeting around 500 GW of non-fossil fuel-based power generation capacity, compared with about 300 GW currently.
This long-term capacity growth has implications for companies in wind turbines, solar power, equipment manufacturing, project development and related infrastructure.
Suzlon Energy, as one of India’s largest wind energy companies, could potentially benefit from the expansion of wind power capacity if project execution and order activity remain strong.
But investors should also consider execution risk, financing costs, competition, commodity prices and regulatory changes in terms of renewable energy stocks.
What should Suzlon investors watch for today?
The short-term traders will be looking to see if Suzlon can maintain its recent momentum and get above ₹51.20.
A successful breakout could bring ₹55-₹56.50 into focus, followed by the ₹60–₹62 zone. On the other hand, weakness below the ₹46-₹47 support region could signify that the recent recovery is losing momentum.
Investors will also be monitoring developments in renewable energy regulations, project execution, new orders, market sentiment and overall energy prices.
Suzlon and other wind-energy stocks could continue to attract investor interest with renewable energy investment in India still a big policy focus.
Comments
Please to leave a comment on this article.