Suzlon - Hawa Ka Jhoka?
Wondering about the title? Don’t confuse it with Sameer (Salman Khan from Hum Dil De Chuke Sanam) who is referred to as Hawa ka Jhoka in a scene where he remained static the whole night in one position and releases the gas early morning when Aishwarya Rai ends the game.
Well this is not about any movie scene or hawa ka jhoka. It’s about Suzlon, a company which is involved in manufacturing wind turbines. Well hawa (wind) does come into the picture; just that here it’s not a jhoka but an entire typhoon of green energy. And the company is about a lot more than just wind turbines! It aims to be a company that serves society with sustainable wind-power on a commercial scale. It was started in 1995 with just 20 people, and now it’s a leading wind power company with –
- Over 14,000 people in 21 countries
- Operations across the Americas, Asia, Australia and The Netherlands
- Fully integrated supply chain across three continents
- Sophisticated R&D capabilities in Denmark, Germany, India and The Netherlands
- Market leader in Asia and 5th largest wind turbine manufacturer in the world
The short span of 14 years in which the company grew at a stupendous rate is incredible. Let’s look at its fundamentals and financials. Like the industry it operates into (sustainable development – creating awareness about Global Climate Change), Suzlon has made sure that it remains green. Well I classify a company as green when it’s past growth rates (YoY as well as aggregate) having all been greater than 12%.
Suzlon - Graphical Plots
ROE and ROIC
If you study the company further, you’ll observe that not only is the company fully green, but it also has a high ROE (Return on Equity) average of 36.69 for the past 6 years. ROE does not include the debt factor. Don’t worry; its ROIC (Return on Investment Capital) is equally good. It has a 6 year average of 24.97. These two figures are very important to look at because they give a fair picture of how the management has been using its funds.
If you’re looking for dividends, then Suzlon is not your cup of tea (Very little and erratic). But my dear friends please notice one more thing. If a company does not return us, the investors, our hard earned money, it better use it efficiently and grow. And what better example do you need? Suzlon has proved it continuously over the past 14 years…
Debt to Net Profit
It’s debt to net profit has always been in control. Currently it’s at 2.17. This ratio serves as a metric, which tells us the time a company will take to repay its entire debt if it continues to grow its profits at the rate at which it has been growing till now. Well if this ratio is less than or equal to 3, it’s considered safe and within limits. In fact, this is the maximum Suzlon has ever let this ratio reach. Otherwise it’s always less than or equal to 1.
Going Ahead
I hope that Suzlon continues to give out not hawa ka jhoka’s but an entire hawa ka typhoon! In short and simple words, I expect the company to continue to grow and spread the greenery all around the world. I can associate myself even better with the company because it’s contributing to controlling global warming – an issue which remains largely ignored in spite the fast spreading awareness. My hopes are based on the splendid performance of the company in the past, which trounced the critics and non-believers. Thanks Mr. Tulsi R. Tanti for turning Suzlon into a gem.
This article was written by Charu Gupta. She also writes at her own blog at Charu’s Blog
Tags: suzlon
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