Suzlon’s Loss Narrows as India Wind Market ImprovesNatalie Obiko Pearson
Suzlon Energy Ltd., India’s biggest wind-turbine maker, reported a narrower loss in the fiscal first quarter as it benefits from improving margins and policy decisions in its home market.
The net loss shrank to 7.5 billion rupees ($125 million) in the three months through June from 10.6 billion rupees a year earlier, the Pune-based company said today in an e-mail. Total income rose 20 percent to 46.7 billion rupees.
The manufacturer’s gross margins improved 4.4 percent “primarily due to our focus on more profitable markets,” especially India, Kirti Vagadia, group head of finance, said by phone today.
Suzlon is leading gains this year among global wind-energy companies on expectations of a recovery. This month, it reached a deal with bondholders after causing India’s biggest convertible bond default in 2012. It also expects to capitalize on favorable policy announcements by Prime Minister Narendra Modi’s government.
India will reintroduce an accelerated depreciation tax benefit for wind-farm investors, Finance Minister Arun Jaitley told parliament today. The incentive, which helped develop India into the world’s fifth-biggest nation in wind power, was withdrawn two years ago causing annual installations to plummet.
The restoration of that incentive could lead to an additional 1,000 megawatts of demand this year, Vagadia said. Suzlon expects to win the bulk of those orders because “we’re strongly positioned in this market segment,” the effects of which should be seen in the second half of this fiscal year, he said.