Suzlon powers up

Suzlon Energy jumped up 8% to Rs.17.60 and remains firmly in the green.

The reason for this is an “unconfirmed” news. A report in the Financial Express today states that the company will be exiting its Corporate Debt Restructuring (CDR) by March 2017.

The huge debt it piled up after taking over RePower, now renamed as Senvion for 1.4 billion Euros was the company’s undoing. The huge debt combined with falling demand for wind turbines pushed the company almost perpetually into the red. In fact Suzlon made history when it earned the dubious distinction of being the biggest defaulter in foreign currency convertible debt. Eventually, Suzlon sold off this Senvion for 1 billion Euros, helping bring down the debt.

This is what pushed the company into the CDR program and slowly but surely, it now looks like the company will climb its way back up out of this debt.

The report says that Suzlon expects its cash balance to exceed its debt in five years as it increases operating capacity and cuts its interest payments. It plans to add 15 gigawatts of wind and solar energy capacity over the next five years to its current asset base of 9.5 gigawatts, having acquired enough land to undertake projects.

The stock exchange has asked for a clarifcation on this news as there was no official word about this from the company.