Suzlon Energy Limited

Credit Risk Report

Dipeeka Thikekar-IN0817

Kapil Khirani-IN0826

Sanjay Mehra-IN0853

Heer Shah-IN0
 Suzlon SUZLON ENERGY LIMITED

Suzlon Energy Limited is a vertically integrated wind turbine manufacturer – with manufacturing capability along the full
value chain – ranging from components to complete wind turbine systems. The company has established manufacturing
facilities in India, China and the United States, to support the global spread of its operations.

The company currently has a combined manufacturing base of 2,700 MW of annual capacity, and is undertaking an
aggressive expansion program to expand its base to 5,700 MW of capacity in FY2008-09. The success of the company’s
strategy is seen in its growing market share, repeat orders, and breakthroughs into new markets. Suzlon ranked as the world’s
fifth leading wind turbine manufacturer with over 7.7% of global market share in 2006. The company has ranked as the
leading manufacturer in the Indian market for nine consecutive years, maintaining over 50% market share.

CURRENT ISSUES

Impending Financial obligations-

• Eur129 mn p.a. debt repayment
• Rs4 bn capex, ~Rs85 bn in WC
• Capital raising likely; Rs10 bn reduction in WC by Fy10
Technological Issues
• Blade cracking
• Need better design & R&D for future
• V3 blades validated performance; Await REpower domination
Sector slowdown
• Lower Project financing
• Investors, profitable cos to compensate disappear
• Visibility down from 2yrs to 9-12 months; Govt. subsidies
Scaling-up
• Components Strategies
• Technological up gradations
• Acquisition of Hansen,RE Power and investment in SE Forge
GROWTH STRATEGY

a) Suzlon is entering into new markets like South Africa, Korea etc., at the same time leveraging its marketing offices
in China, Europe, The US and Australia to strengthen its presence in these countries.
b) Developing end to end, turnkey wind power solution profiles in India and other markets, thereby providing
customers the benefits of higher cost-efficiencies and increased economies of scale.
c) Build on its operations and maintenance expertise to enhance the performance of WTGs
d) Build on its enviable track record and experience, gathered across various geographical locations over the last
decade. Complex projects have allowed Suzlon to develop the capabilities and expertise needed for large wind farm
projects, giving it leadership across the entire value chain in the extremely technology sensitive wind power
marketplace.
 FINANCIALS

BALANCESHEET (Rs in Crores)

2009 2008 2007 2006 2005
SOURCES OF FUNDS

Shareholders' funds
Share capital 299.66 299.39 287.76 302.53 201.92
Employee stock options outstanding 8.25 10.22 11.71 10.36 0
Share application money pending allotment 0 0 0.02 0 0
Reserves and surplus 6,177.41 6,638.05 3,413.82 2,509.36 727.65
6,485.32 6,947.66 3713.31 2822.25 929.57
Share application money pending refund 95 0 0 0 0
Loan funds
Secured loans 4,006.23 672.26 771.78 276.61 285.46
Unsecured loans 3,323.25 2,412.48 364.86 58.76 37.08
7,329.48 3,084.74 1,136.64 335.37 322.54
TOTAL 13,909.80 10,032.40 4,849.95 3,157.62 1,252.11

APPLICATION OF FUNDS

Fixed assets (including intangible assets)

Gross block 915.83 779.2 567.04 400.41 217.88
Less: Depreciation / amortisation 364.33 266.98 178.57 104.73 57.61
Net block 551.5 512.22 388.47 295.68 160.27
Capital work-in-progress 286.97 134.64 92.71 76.25 17.93
838.47 646.86 481.18 371.93 178.2
Investments 7,127.80 4,919.48 805.26 292.74 126
Deferred tax assets 175.4 93.64 70.88 58 27.61
Foreign Currency Monetary Item Translation
Difference 399.26 0 0 0 0

Current assets, loans and advances

Inventories 1,383.62 1,483.23 1,375.25 1,104.49 494.58
Sundry debtors 4,745.14 3,306.59 1970.78 1583.91 676.33
Cash and bank balances 212.4 875.5 351.39 316.24 88.2
Loans and advances 2,698.75 1,289.15 1297.19 691.13 375.98
9,039.91 6,954.47 4,994.61 3,695.77 1,635.09
Less : Current liabilities and provisions
Current liabilities 3,301.77 1,946.39 1108.47 858.32 529.19
Provisions 369.27 635.66 393.51 402.5 185.6
3,671.04 2,582.05 1501.98 1260.82 714.79
Net current assets 5,368.87 4,372.42 3,492.63 2,434.95 920.3
TOTAL 13,909.80 10,032.40 4,849.95 3,157.62 1,252.11

PROFIT & LOSS ACCOUNT (Rs in Crores)

Particulars
2009 2008 2007 2006 2005 2004
INCOME
6926.0 5380.3 3788.4 791.15
Sales 7235.58 1 7 6 1917.5 1
other income 177.14 125.61 88.1 69.28 23.26 13.74
7051.6 5468.4 3857.7 1940.7 804.89
7412.72 2 7 4 6 1

EXPENDITURE

4226.9 3232.4 2282.2 1141.4 503.08

Cost of goods sold 4543.85 9 7 1 5 5
126.75
operating & other expenses 1803.47 952.51 830 509.48 291.22 4
employees' remuneration & benefits 199.07 139.34 111.46 62.96 35.32 17.657
financial charges 433.97 139.61 101.47 54.56 41.3 25.684
Depreciation 99.16 86.21 73.49 45.87 38.97 9.654
preliminary expenses written off 0 0 0 0 0.06 0.032
5544.6 4348.8 2955.0 1548.3 682.86
7079.52 6 9 8 2 6

1119.5 122.02
PBT AND EXCEPTIONAL ITEMS 333.2 1605 8 902.66 392.44 5
Exceptional items, net of tax 873.16 285.21 0 0 0 26.693
Current tax 0 155 130 107 48 13
MAT credit entitlement 0 -89 -50 0 0 0
deffered tax -81.76 -23.49 -13.02 -27.97 -17.08 -9.405
fringe benefit tax 11.07 11.44 2.42 2.4 0 0
earlier year 0 0.13 -10.96 0.04 0.06 -0.777

1265.7 1061.1
NET PROFIT -469.27 1 4 821.19 361.46 145.9

1477.8 238.34
Balance brought forward 2268.44 6 882.49 526.95 306.63 4

PROFIT AVAILABLE FOR 2743.5 1943.6 1348.1 384.24

APPROPRIATIONS 1799.17 7 3 4 668.09 4

Interim dividend on equity shares 0 0 143.88 71.88 23.18 7.304

Proposed dividend on equity shares 0 149.69 0 71.88 11.59 17.044
Dividend on preference shares 0 0 1.5 1.51 1.51 0.09
Tax on dividends -1.05 25.44 20.39 20.38 4.86 3.175
Transfer to general reserve 0 300 300 300 100 50
Residual divident of previous year 0.13 0 0 0 0 0

1800.0 1477.8 306.63

Surplus carries to balance sheet 2268.44 9 6 882.49 526.95 1

CASH FLOW STATEMENT (Rs in Crores)

2009 2008 2007 2006 2005

CASH FLOW FROM OPERATING ACTIVITIES

Profit before tax and exceptional items 333.20 1605.00 1119.58 902.66 392.44

Adjustments for:
Depreciation / amortisation 99.16 86.21 73.49 45.87 38.97
(Profit) / loss on assets sold / discarded, net (0.16) 2.93 (1.85) 0.44 0.44
(Profit) / loss on sale of investments, net (9.30) 0.00 3.21 0.00 10.09
Interest income (122.43) (96.89) (59.17) (33.32) (20.56)
Interest expenses 380.12 125.35 89.33 42.52 31.93
Dividend income (11.29) (6.32) (3.77) (3.09) (2.02)
Provision for dimunition of investments 99.76 0.00 0.00 0.00 0.00
Premium on redemption of preference shares (9.61) 0.00 0.00 0.00 0.00
Provision for operation, maintenance and warranty 143.05 52.91 91.54 117.93 69.36
Expenditure towards operation, maintenance and warranty 0.00 0.00 (86.07) (42.76) 0.00
Provision for performance guarantee 281.79 236.79 104.24 104.82 49.62
Expenditure towards performance guarantee 0.00 0.00 (64.27) (24.23) 0.00
Provision for liquidated damages 155.65 4.94 0.00 0.00 0.00
Bad debts written off 2.07 7.39 0.29 0.00 0.00
(Reversal) / provision for doubtful debts and advances 7.72 11.80 1.38 (5.39) 8.93
Employee stock option scheme 4.97 4.53 7.30 10.36 0.00
Preliminary expenses written off 0.00 0.00 0.00 0.00 0.06
Exchange differences, net 0.63 (18.94) 0.00 0.00 0.00
Wealth-tax 0.04 0.04 0.03 0.02 0.01

Operating profit before working capital changes 1355.37 2015.74 1275.26 1115.83 579.27
Movements in working capital
(Increase) / decrease in sundry debtors (1443.93) (1355.08) (388.53) (902.84) (368.62)
(Increase) / decrease in inventories 99.60 (107.97) (270.76) (609.91) (292.87)
(Increase) / decrease in loans and advances (220.25) (226.94) (4.05) (197.57) (25.93)
(Increase) / decrease in margin money deposit (45.18) (3.57) 0.00 0.00 0.00
Increase / (decrease) in current liabilities and provisions 449.30 386.03 276.59 327.49 213.17
Cash (used in) / generated from operations 194.91 708.21 888.51 (267.00) 105.02
Direct taxes paid (net of refunds) (64.41) (161.38) (141.16) (122.78) (41.79)
Net cash (used in) / generated from oper act before 130.50 546.83 747.35 (389.78) 63.23
exceptional items
Exceptional items paid (521.67) (65.46) 0.00 0.00 0.00
Net cash (used in) / generated from operating activities (391.17) 481.37 747.35 (389.78) 63.23

CASH FLOWFROMINVESTING ACTIVITIES

Purchase of fixed assets (288.67) (255.25) (190.44) (240.41) (70.28)
Proceeds from sale of fixed assets 1.40 0.44 9.54 0.38 0.42
Purchase of investments 0.00 0.00 (527.02) (170.89) (85.38)
Investments in subsidiaries (2678.71) (4114.22) 0.00 0.00 0.00
Sale / Redemption of Investments in subsidiaries 389.53 0.00 11.30 4.15 2.60
Inter-corporate deposits repaid / (granted) (35.78) 443.34 (258.36) 3.18 (135.52)
Loans granted to subsidiaries (2373.27) (1746.31) (280.73) (106.26) 14.94
Repayments received from subsidiaries 1273.83 1632.82 0.00 0.00 0.00
Interest received 123.13 91.13 64.55 26.80 20.46
Dividend received 5.36 1.50 5.62 2.64 0.08
Net cash flow from investing activities (3583.18) (3946.55) (1165.54) (480.41) (252.68)

CASH FLOWFROMFINANCING ACTIVITIES

Redemption of preference share capital 0.00 0.00 (15.00) (100.00) 0.00
Share application money received 95.00 (0.02) 0.02 0.00 0.00
Proceeds from issuance of share capital including premium,
under stock option scheme 6.94 6.02 5.95 0.00 0.00
Proceeds from issuance of share capital including premium 0.00 0.00 0.00 1364.89 200.00
Share Issue Expenses 0.00 0.00 0.00 (40.67) (7.57)
Capital including premium to qualified institutional buyers 0.00 2182.70 0.00 0.00 0.00
Debentures, zero coupon convertible bonds and share issue
expenses (5.05) (49.19) 0.00 0.00 0.00
Proceeds from issuance of debentures 300.00 0.00 0.00 0.00 0.00
Proceeds from long term borrowings 590.00 0.00 2326.06 263.49 171.13
Proceeds from issuance of zero coupon convertible bonds 0.00 2009.90 0.00 0.00 0.00
Repayment of long term borrowings (41.96) (109.42) (1524.80) (250.65) 69.25
Proceeds from short term borrowings, net 2861.02 71.10 0.00 0.00 0.00
Interest paid (365.89) (125.23) (89.44) (41.92) (31.44)
Dividend paid (149.83) 0.00 (218.77) (84.99) (40.32)
Tax on dividend paid (24.39) 0.00 (30.68) (11.92) (5.27)
Net cash flow from financing activities 3265.84 3985.86 453.34 1098.23 217.29

Effect of Exchange Difference on Cash and Cash Equivalents 0.23 (0.15) 0.00 0.00 0.00

NET INCREASE IN CASH AND CASH EQUIVALENTS (708.28) 520.53 35.15 228.04 27.84
Cash and cash equivalents at the beginning of the year 779.23 258.70 316.24 88.20 60.36
Cash and cash equivalents at the end of the year 70.95 779.23 351.39 316.24 88.20
RATIO ANALYSIS

Ratios 2009 2008 2007 2006 2005

Sales growth (%) 4.47 28.73 42.02 97.57 142.37
EBITDA growth (%) -59.09 33.38 29.57 109.43 -6.90
PAT Growth (%) -137.08 19.28 29.22 127.19 147.75
EBITDA/Sales (%) 9.01 23.00 22.20 24.33 22.95
EBIT/Sales (%) 7.64 21.75 20.83 23.12 20.92
EBIT/Interest 1.45 12.02 12.55 20.60 12.56
PAT Margin (%) -6.49 18.27 19.72 21.68 18.85
RoAA(%) -0.10 0.33 0.39 0.40 0.40
Debt/Equity (%) 1.13 0.44 0.31 0.12 0.35
Debt/EBITDA (%) 1124.67 193.66 95.17 36.38 73.28
FFO/Debt (%) 0.18 0.65 1.12 3.33 1.80
FFO/Interest (%) -3.70 -16.10 -14.26 -26.62 -18.42
CFO/Total debt -0.05 0.16 0.66 -1.16 0.20
Current Ratio 2.46 2.69 3.33 2.93 2.29
Accounts Receivable Turnover 1.82 10.67 12.64 33.29 62.24
Accounts Receivable days 203.09 139.06 120.57 108.88 94.57
Accounts Payable Turnover 3.72 4.35 5.08 5.83 4.28
Accounts Payable Days 98.04 83.84 71.91 62.64 85.27
Inventory Turnover 5.05 4.85 4.34 4.74 5.51
Inventory Days 72.31 75.32 84.11 77.03 66.27
Working capital Days 177.35 130.54 132.77 123.27 75.57

Sales Growth

Ratios 2009 2008 2007 2006 2005

Sales growth (%) 4.47 28.73 42.02 97.57 142.37

Though sales growth percentages are very fluctuating in Suzlon but still they were efficient to maintain their Order Book
outlook.
Order outlook for Suzlon Wind

– Current order book 1,463 MW as on 25 June 2009

– Order value Rs.7,901 crs. Order book- build up in progress

• Guidance for international order accretion of 1,000 MW by end-July 2009 (29th Jan 2009)
– New 499 MW orders won:
○ 245 MW from Australia
○ 199 MW from China
○ 42 MW from USA
○ 13 MW from Europe

– 225 MW framework agreement with EUFER (JV between ENEL Green Energy and Union Fenosa) for Spain

○ 1,501 MW confirmed order book as on 30th July 2009

○ Domestic: 66 MW, Rs.380 crores
○ International: 1,435 MW, Rs.7,936 crores
 Financial position of Suzlon Pre Hansen & Re -Power Acquisition

Cumulative wind power installations worldwide reached 59,264 MW by the end of calendar year 2005. The Indian wind
energy market has shown a growth of 41.80% during the period.

Particulars 2004 (Crore) 2005 (Crore) Change in Percentage

Sales 791.15 1917.5 98%

EBITDA 458.15 884.22 93%

PAT 365.33 759.50 108%

Company raised funds through an IPO of 29,340,000 equity shares of Rs.10 each for cash at a premium of Rs. 500 per equity
shares.

Acquisitions

Suzlon has, over the past few years, increased its reliance on debt for funding its acquisition.Suzlon acquired Hansen in the
year 2006 to meet its gearbox requirements and to reduce its lead time in its supply chain and Repower Systems in 2007 for
enhancing technological capabilities.

Hansen (May 2006-Backward Integration)

 100% stake, Euro 465mn

 Debt: Euro 440mn + cash Euro 30mn
 To fund capex of Hansen - IPO 27.1% of Hansen in Dec 07 at value of Eur1.6bn (3x cost of acquisition)
 It bought Hansen’s holding company Eve Holding from PE firms Allianz Capital Partners and UK private equity
firm Apax Partners
 Paid 60 million euro in cash (Transfer funding from Suzlon Balance Sheet to Hansen Balance Sheet)
 292 million Euro and 83 million Euro were provided through issue of bonds etc.
 They raised the money through IPO and utilized this money for expansion and capitalization of subsidiaries and
growth opportunities in domestic and international markets and hence after this year they entered the international
markets.
 STRATEGY/REASONING -There are high entry barriers and huge lead time in the gearbox industry and hence
acquiring Hansen which was globally the 2nd largest in wind gearbox was a good decision as it reduced its overall
lead time in its supply chain.

Repower Systems (Forward Integration)

 Acquired in 2007 (total: Euro1, 196mn)

 May07: E453mn, May08:E473mn, Dec08:E65mn, Apr09: 30mn, May09:E175mn
 Funded through FCCB’s (bridge financing & refinancing of debt)
 The acquisition was financed through its subsidiaries which purchased 33.85% stake for a consideration of
approximately Euro 453 million on June 6, 2007
 During REPower’s acquisition, Suzlon had entered into an agreement with the other major shareholders — Areva
and Martifer (holding ~30% and ~22% stake respectively) — to buy out their respective shares over two years.
Areva’s 30.16% stake in REPower was bought out in June 2008 for an undisclosed sum. Suzlon was expected to pay
Martifer for its remaining stake by May 2009. However, given the already stretched balance sheet and impending
risk of breach of covenants, investors were concerned of Suzlon’s ability to payout Martifer completely. Inability to
pay Martifer would have resulted in loss of reputation and could have created hurdles in the integration process of
REPower operations with Suzlon ahead. The company went ahead and revised its payment schedule with Martifer
with payouts to be made over four tranches through December 2008-May 2009. Up to March 2009 Suzlon had
invested ~EUR1.1bn for the REPower acquisition. Being fully committed to the business operations of Suzlon,
promoters offloaded ~6% of their stake in the company, raising ~Rs7.5bn in May 2009 to finance the residual
Martifer payment. This has resulted in reducing promoters’ stake in the company to ~60%.
 It was financed in tranches with loan repayment up to 7 years, which got partly refinanced through convertible
bonds issue and follow-on equity offering proceeds
  For additional stake in Re-Power Suzlon got fund through by selling their 17.1% stake in S.E.Forge to IDFC Private
Equity and 2-4% stake in Suzlon and 10% stake in Hansen, which accounted to Euro 205 million, additional were
loan taken. It holds around 90% in Re-Power.
 During the acquisition of Repower systems it had to face the various risks like exchange rate risk (1 euro was 105),
increase in interest rates which led to increase in their cost of borrowing and even the decreasing crude oil and coal
prices.
 STRATEGY/REASONING- Repower’s raw material cost which was as high as 82% of sales according to
European cost structure and hence Suzlon saw that by acquiring Repower it can reduce the raw material cost by 62%
and gain from lower procurement costs for common components because of the combined volumes
 Before the acquisition of the above the valuation of Suzlon was low as compared to BHEL and hence through these
acquisitions it increased its EPS which in turn helped increasing its share price.

Focus on Debt Reduction & working capital management

Suzlon reported deterioration in working capital levels in FY2009 177 days of sales from 130 days of sales. This was led
by an increase in receivables to 203 days of sales in FY2009 versus 139 in the previous year. Suzlon management stated that
the rise in receivables was primarily led by the international orders for which the receivables amount far exceeded what was
shipped last year. However, the company does not expect and write offs/ bad debts from the same. They expect an
improvement of 25-30% in the receivables level going forward. The raw material management of the wind business has
improved from 98 days of sales in FY2008 to 83 in FY2009. The management highlighted that the company has become very
conscious about the working capital management and should improve the working capital levels by at least 25-30% in
FY2010E. We highlight that Suzlon operates with very high working capital levels versus peers such as Vestas and hence
there could be scope for such an improvement.

Following ratios shows clear picture of Working Capital management

Particulars 2009 2008 2007 2006 2005

Sales growth (%) 4.47 28.73 42.02 97.57 142.37
Current Ratio 2.46 2.69 3.33 2.93 2.29
Accounts Receivable days 203.09 139.06 120.57 108.88 94.57
Accounts Payable Days 98.04 83.84 71.91 62.64 85.27
Inventory Days 72.31 75.32 84.11 77.03 66.27
Working capital Days 177.35 130.54 132.77 123.27 75.57

Various cost optimization measures initiated for alignment of cost base to current environment and to support EBITDA
margins and cash flows
COGS
 Identified key levers where cost reduction is possible
 Renegotiating contracts with suppliers for price reductions
Freight
 Reduction in freight costs due to general drop in ocean freight rates
Claims /provisions
 Focused approach in various geographies to avoid various quality related costs and LDs
 More effective monitoring and control of all product related costs
Opex Costs
 Identification of cost reduction areas in Manufacturing and Marketing / Project SBUs

Liquidity needs addressed through long-term fund infusion: USD 202 mln

 Issuance of Global Depository Receipts (GDRs) for USD 108 mln (21st July 2009)
 Listed on Luxembourg Stock Exchange
 14.6 mln GDRs issued at price of USD 7.40 per GDR
 Convertible into four equity shares per GDR (total 58.4 mln equity shares)
 Issuance of USD 90 mln Zero Coupon Convertible Bonds (21st July 2009)
 Listed on Singapore Stock Exchange
 Priced at 104.3% of Face Value (total funds raised USD ~94 mln)
 YTM of 5.97%; maturing on 25th July 2014
 Initial conversion price of Rs.90.34
 Financial covenants in FCCBs and Acquisition Loan Facility

 Modification of debt covenants achieved- a) The new series of Bonds have no covenants (B) the existing June’07
bonds have reduced covenants that is, Net D/E=1.5x and Net Debt /EBITDA=4x (c)However no reduction in
Covenants of October 07
 Liability Management Exercise for $500 million FCCBs (June 2007 and October 2007 series) undertaken
 Reduction in FCCB liability by $111 million achieved through buyback and exchange mechanisms
 Simultaneously achieved debt covenant modification for Acquisition Loan Facility
 All covenants met as on 31st march 2009
 on 31st March200
FCCB Restructuring Details
 Option 1: Issuance of new bonds for old bonds — exchange ratio of 60%.The total amount of new bonds to be
issued will be a maximum of US$147mn (for the June and October 2012 series together). This implies that a
maximum of US$147mn/0.6 = US$245mn of face value of bonds can be exchanged in this fashion. The newer
bonds would have a lower conversion price and a lower YTM.
 Option 2: Cash buyback of bonds — Sell the bonds to the company for cash, with minimum cash consideration of
US$40mn (company has the option of increasing cash consideration limit).
 Option 3: Incentive fee for change in covenants — Receive an incentive fee of up to 10% of the face value of
bonds up to US$15mn (as RBI has permitted paying up to US$15mn) for the proposed amendments to covenants.
 FCCB restructuring could be a positive —It would help increase Suzlon’s financial flexibility over the longer
term. It would also help address short term funding constraints, taking advantage of the new and easier debt
covenants.
 Existing FCCB Details
FCCB – I FCCB-II

Amount (US$mn) 300

Amount (US$mn) 200

Exchange Rate 40.83

Exchange Rate 39.9

Conversion Price 359.68

Conversion Price 371.55

Shares Dilution (mn) 34.1

Shares Dilution (mn) 21.5

Redemption Amount (US$mn) 436

Redemption Amount (US$mn) 290

Due date June 2012

Due date Oct 2012

FCCB – Financial Covenants

I. June 2012 convertible (US$300mn)
II. October 2012 convertible (US$200mn)
 I (June 2012) II ( OCT 2012)

(US$ 300 mn) (US$ 200 MN)

Consolidated total net borrowing / Consolidated tangible net <= 1.0x 1.5x
worth

Adjusted consolidated EBITDA / Debt service >= 1.33x 1.33x

Consolidated Total Net Borrowing/Consolidated EBITDA <= 5.25x 5.25x

For FY08

For FY09 <= 4.0x 4.0x

For FY10 <= 3.0x 4.0x

Post FY10 <= 2.0x 3.0x

CURRENT DEBT STRUCTURE

Loan item Amount (Rs bn) Payable

Acquisition loan 34.00 Rs8.8bn to be paid each year for three years, reducing after that until FY15

FCCB 29.7 Rs25bn to be repaid in FY13 and rest in FY15

Capex loan 12.0 Rs2.4bn each year

Working capital debt 53.5 On-going refinancing

 129.2

Strengths

• Strong growth in the wind energy market; several factors leading to increasing traction in the industry.
• Strong market position in the global wind energy market
• Vertical Integration supports strong operating profile
• Recent Acquisitions complementary to the company’s operations.

Weaknesses
• Large debt-funded acquisition, moderating the financial profile
• Changes in regulation in key markets could lead to a slowdown in capacity additions.
• The company is new in some of its overseas markets such as China and Australia. These geographies are also being
tapped by global competitors.

Opportunities
• The increased thrust for renewables globally should present new opportunities for Suzlon. Various states are also
making it mandatory to source power from renewables in their energy mix.

Threats
• Any breakthrough in new technology in coal-based generation should mean less clamour for renewable.
• Tighter budgetary control by governments could mean lower subsidies for renewables.