''Who was Tulsi Tanti - The Man Behind Suzlon Energy''.
Every trader must have traded Suzlon at some point in their trading journey – whether it was during its initial years from 2005 to 2008 when it was soaring like a phoenix, or from 2009 to 2019 when it was struggling, or from 2020 to now when it is once again rising rapidly in its second innings and now seems quite promising.
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Yes, indeed, in 2020, Suzlon Energy was at ₹3.30, and today in 2022, it has reached ₹13. And in every trader, there is a hope somewhere that sooner or later Suzlon will return to its old position (₹144 in 2005, ₹200+ in 2007, and ₹400+ in 2008 during its peak years), especially after the recent boost in sustainable development and renewable energy by the Government’s initiative and the growth in demand.
Although Suzlon’s turnaround seems promising, it is unfortunate that the person who not only created Suzlon but also successfully raised the company to such heights will not be there to witness it. Yes, we are talking about the company’s founder, Tulsi Tanti, the pioneer of India’s wind energy sector, who managed through both fair and foul weather. Unfortunately, he passed away untimely on October 1 at the age of 64 due to cardiac arrest.
About Tulsi Tanti and Suzlon
Tanti’s may not exactly be a rags-to-riches story, but it is a story of Indian ingenuity, ambition, and resilience.
In 1987, Tanti, along with his siblings, started a textile business in Surat under the name Sulzer Synthetics with around 20 employees. After some time in the business, they realized that they could make more profit by installing a captive wind energy unit than from their current business.
Then, in 1995, he opened a green energy company with a focus on wind energy. Back then, it was still early days for the industry, and India only had a token presence in renewable energy. And then, 10 years later, in 2005, Suzlon India was born – India’s first renewable energy company that launched its Rs 1,500 crore IPO, which was oversubscribed almost 15 times. Next, Tanti made it to Forbes’ list – he was at the eighth spot on Forbes’ list of richest Indians in 2005. The decade from 2005-15 witnessed fast growth in wind energy capacity in the country.
Around the same time, Suzlon established a strong foothold in the country, capturing almost 50 percent of the local market and emerging as one of the top five wind turbine makers globally.
Tanti and Suzlon then expanded globally, and Suzlon acquired Belgium’s gearbox maker, Hansen Transmissions International.
Tanti then made his boldest move in 2006-2007, announcing that Suzlon’s subsidiary AE-Rotor Holding B.V. had acquired Germany’s REpower Systems to expand its presence in Europe and get access to the company’s technology.
Even as the company was piling on debt, Suzlon Energy became the proxy for India’s wind energy story, and Tanti the poster boy. Investors were upbeat, and the company’s market capitalization soared to over Rs 68,000 crore in January of 2009.
Although REPower Systems should have been a milestone for Suzlon’s global ambition, Suzlon and Tanti had to face significant difficulties.
In July 2012, Suzlon defaulted on the repayment of $209 million worth of foreign currency convertible bonds (FCCBs), the biggest of its kind at the time. After struggling with mounting losses and muted cash flows, Suzlon got a big relief in 2013 as lenders led by State Bank of India (SBI) restructured Rs 9,500 crore of loans and eased the terms of repayment. The company also got a fresh working capital loan of Rs 1,800 crore to keep it afloat. In 2015, billionaire Dilip Shanghvi came in as a white knight and acquired a 23 percent stake in the company.
Since then, the company has been facing many challenges, but it is scaling up one way or another.
Fundamentally Suzlon Energy current stats -
- PE Ratio (x) 3.55
- EPS – TTM (₹) 2.24
- VWAP (₹) 7.97
- PB Ratio (x)-2.46
- M Cap (₹ Cr.) 8,008.10
- Face Value (₹) 2.00
- BV/Share (₹) -3.54
- Sectoral MCap Rank 15
- 52W H/L (₹) 13 / 5.41
- Beta 2.62
- MCap/Sales 1.28
Recently, Suzlon gave a 3-year return of 278.26% as compared to Nifty Midcap 100 which gave a return of 95.02%. (as of last trading session). Besides, company’s annual revenue growth of 96.22% outperformed its 3-year CAGR of 9.08%
What are analysts saying about Suzlon Energy now that Tulsi Tanti is no longer there?
Although the company has suffered a setback with the departure of Tulsi Tanti, market analysts believe that this setback will not be reflected in the company’s balance sheet and will not impact the company’s shares. They say that the company was incurring losses while regularly paying off its debt and interest. Now that a significant portion of the debt has been reduced and the company is also planning a ₹1,200 crore rights issue, analysts are positive about Suzlon. They suggest that Suzlon’s results will now be positive on a quarter-on-quarter basis.
Lastly,
One thing that admirers and even critics of Tanti have always agreed on was that he never gave up. His demise may have cut short his story, but the story of Suzlon and the Indian wind energy sector will continue. Will his efforts for the company and the industry pay off? The answer is up there…The change he brought is no small feat, and he is one of our Indian Idols who needs to be followed and cherished.
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