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Wednesday, January 12, 2011

SUZLON's chances of bankruptcy is LESS.....

People are talking about SUZLON ENERGY's bankruptcy & that the company cant service its debt in time ...blah blah...blah...Now they know the difference between a good asset company & bad asset company and still they talk like this shame....
ANYWAYS...here's what I feel about Suzlon, agreed that it has the debts of Rs.9,252 cr & Reserves of Rs.5,892 Cr.(which can take care of losses).
As for the question on loans repayments then here's the answer –
Suzlon took loans for acquisition of Hansen & REpower a german base company. They sold some of the stake in Hansen but they eventually raised their stake in REpower by 14.4 % to current 90.50%.
Share holding Pattern of Click  REPOWER AG -
SUZLON 90.50 %83,25,845.245 Shs
FREE FLOAT9.50 %8,73,983.755 Shs
TOTAL 100 %91,99,829 Shs
Current Market Price of REpower – 114.5 Euros/Sh (JAN 12 2011)(58.72/1Euro)
The Free float of REpower is 9.5% - 8,73,983.755 Shs = 100.07 m Euros, around Rs.587.62 Cr, According to German laws Suzlon has to buy the entire 9.5 % of REpower in order to integrate REpower’s assets into itself.
NOW , REpower has Total Asset of 1,032.62 m Euros; Shareholders Fund – 475.97 m Euros, EPS – 6.34 Euro/Sh; Dividend paid 1.54 Euro/sh; Total debt of 556.6 m Euros; Debt/Eq – 0.40. NP – 57.93 m Euros.
So, my friend SUZLON adds Rs.2794.89 Cr to its books by just paying Rs.587.62 Cr.Suzlon's debts of Rs.9,252; Reserves of Rs.8686.89 Cr (5,892 + 2794.89 of Repower); D/E ratio will be 1.05. NOT BAD..
The stake buy of REpower’s 9.5% will cost Rs.587.62 cr which is possible as Suzlon has recently completed its rights issue of Rs.1180 cr & has restructured its debts .. Off course this may take long time, say up to a year but fundamentals will improve once this REpower stake is bought..
NOW WHAT YOU THING ABOUT THISSSS

Here are some details of REPOWER AG - CLICK HERE
Fiscal 2009/10 (m Euros)Fiscal 2008/09 (m Euros)
SALES1,303.57721,209.0907
EBIT98.31676.8988
PBT83.8576.5526
NET PROFIT57.930351.9365
Total Asset1,032.6242928.3723
Share Holders Equity475.9717408.34
Number of Shares (1 Euro)9199829 shs9177039 shs
EPS6.34 Euro5.75 Euro
Total Dividend14.44373153NIL
Opert. Cash flow119.3
TOTAL DEBT556.6
Net Working Capital195.6
Net W.Capital Ratio14.8 %
Share holders fund464.498048
Minority Interest 11.473691
Revaluation Reserve0.776
Retained Earnings147.707203
Cash211.719

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10 comments:

  1. AnonymousJanuary 13, 2011 at 10:58 AM

    HI BHAVIKK
    Nice post..good info....
    I agree with your views...
    Here is one article I hope you and urs readers
    would like it. click here - http://www.indianexpress.com/news/suzlon-is-a-good-buy-but-comes-with-risks/736739/

    ReplyDelete
  2. AnonymousJanuary 17, 2011 at 12:57 PM

    HI BHAVIKK
    NICE article keep it up...
    You may like this article also click this link
    http://www.seasonalmagazine.com/2011/01/suzlon-power-stock-to-bet-on-in-2011.html

    ReplyDelete
  3. AnonymousFebruary 3, 2011 at 9:24 AM

    HI BHAVIKK
    HERE IS WHAT INDIAN COURT HAVE RULED FOR SUZLON
    http://www.business-standard.com/india/news/suzlon-unit-can-find-new-turbine-partner-says-court/423923/

    ReplyDelete
  4. AnonymousMarch 15, 2011 at 12:54 PM

    The economic collapse of Japan has begun. The extent of the devastation is now becoming clear and many are now projecting that this will be the most exp...
    Bankruptcy

    ReplyDelete
  5. BHAVIKK SHAHJune 8, 2011 at 11:47 AM

    HI Reader Friends !!!
    REpower's Result updates -
    The REpower Systems Group, a subsidiary of Suzlon Energy has achieved total performance of Euro 1.28 billion in FY11 as against Euro 1.33 billion in FY10, reflecting marginal fall of 3.75%. Net income for the year, at Euro 55.6 million, was only slightly down by 3.97% on the previous year`s level of Euro 57.9 million.

    Revenues dropped from Euro 1.30 billion to Euro 1.22 billion. At Euro 86.0 million, EBIT was down 12.5% on the previous year (Euro 98.3 million). The EBIT margin shrank accordingly from 7.4% to 6.7%. After financing expenses and income, earnings before tax for the 2010-11 fiscal year amounted to Euro 80.9 million as against previous year`s Euro 83.9 million.

    Overall, in the yera the 2010- 2011 REpower Systems AG Installed or supplied output amounted to 851 megawatts (previous year: 863 megawatts), of which more than 77% was destined for export. Incoming orders in the period under review came to 1,252 megawatts, which equates to a volume of EURO 1.36 billion.
    The Executive Board and Supervisory Board will propose to the AGM,likely to be held on Aug. 30, 2011, that a dividend of Euro 1.50 (previous year: Euro 1.57) is resolved for the 2010-11 fiscal year.
    An initial measure to improve efficiency is the production of REpower 2 megawatts series wind turbines at a site in Padubidri, India. The MM wind turbines produced there are to be exported to Australia and North America.

    ReplyDelete
  6. BhavikkshahJuly 21, 2011 at 5:00 PM

    HI READERS,
    Good News for SUZLON ,
    Persuant to section 15 of WpHG of German law, the majority shareholder of REpower Systems SE (ISIN DE0006177033, WKN 617703), AE-Rotor Holding B.V., Amsterdam (Netherlands), a subsidiary of Suzlon Energy Ltd.informed the Executive Board of REpower Systems SE that it has set the cash compensation for the transfer of the shares from the minority shareholders of REpower Systems SE to AE-Rotor Holding B.V. at 142.77 EUR per no-par value share in compliance with § 327a German Stock Corporation Act (Aktiengesetz) (squeeze out). A resolution on the squeeze out shall be passed in the annual general meeting of REpower Systems SE. The annual general meeting will not take place on August 30, 2011 as previously announced but has been postponed to September 21, 2011 due to conflicting schedules. Suzlon to utilise 63 million Euros for this.

    AT LAST SUZLON WILL BREATH A FRESH AIR.....

    ReplyDelete
  7. BhavikkshahJuly 25, 2011 at 1:54 PM

    HELLO READER FRIENDS !!!
    An Important updated from Suzlon -

    Suzlon Energy will sell its 26.06 % equity interest in Hansen Transmissions International NV, Belgium to ZF International, its joint venture partner. The offer is to buy the 100 % in Hansen for 445 million pounds. ZF and Hansen have offered a premium of approximately 95.6 %, over the closing price of 33.75 pence per Hansen share on 22 July 2011.
    In November 2010, Suzlon had sold 35.2 % of Hansen for $361 million, bringing down its shareholding to 26 %. This offer is an strategy to optimize and strengthen Suzlon's balance sheet.

    ReplyDelete
  8. AnonymousNovember 2, 2011 at 4:21 PM

    Ted Connolly is a lawyer in the Boston office of a large, international law firm, where he concentrates his legal practice in bankruptcy and finance law.
    tennessee bankruptcy

    ReplyDelete
  9. BhavikkshahApril 3, 2012 at 12:08 PM

    HELLO FRIENDS,
    The government of India has ended a tax break for wind farms, which helped to drive 70% of installation last year in worlds third largest market for turbines.
    From 1st April 2012 wind power projects can no longer claim accelerated depreciation at the of 80 % on the cost of their equipment. Accelerated depreciation is an accounting method that allows wind farm developers to write off investments at a faster rate. Projects built after 31st MARCH 2012 can only claim the standard depreciation rate of 15 %. Axing the tax incentive could cause demand for turbines in India to go down by 15 % this financial year.

    ReplyDelete
  10. AnonymousDecember 17, 2013 at 10:34 PM

    Bhavik. You still think Suzlon is going to set sail Northward? Anytime soon?

    Thanks for sharing your insights. Helps greatly.

    ReplyDelete