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Why Suzlon Revival looks impossible as it lurches from one Crisis to another

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Suzlon which is India’s biggest wind company and one of the biggest turbine suppliers in the world has never recovered from the 2008 crisis. The company which used to be the 5th biggest wind turbine supplier with a market capitalization of over $10 billion is now a shadow of its former self. The company has around $2.5 billion in debt which it is finding impossible to serve with continued losses plaguing the wind equipment industry. The wind industry has radically changed since 2008 and once the impregnable players like Gamesa, Vestas, Suzlon are now targets of consolidation.

Reasons why it is impossible for Suzlon to Survive

Here we list out the reasons why it has become impossible for Suzlon to survive:

1) Wind Industry has matured after the massive growth seen during the 2000-2010 boom. USA and Europe are seeing stable to declining wind turbine sales while China at around 20-30 GW a year cannot grow anymore.

2) The rise of the Chinese wind turbine companies has seen a crash in the prices of wind turbines and a dramatic increase in global competition. Except for integrated players like GE , there is hardly a profitable wind turbine company in the world.

3) Suzlon is saddled with a debt which it cannot possibly repay. It has already sold off some strategic assets like wind farms, stake in Hansen Transmission. However that has not solved its debt problems.

4) Top executives have left the company looking for greener pastures. This makes the problem of the management harder.

5) It has outstanding foreign currency loans of $220 million in October which it cannot pay and is asking for relief from debt holders. It remains uncertain whether lenders will be willing to listen.

Also Read:

India’s Green Poster-child Suzlon in Death Spiral as Debt Load forces it to Sell Key Assets


Suzlon today said the extension would allow the company to close various financing measures and drive alignment between all stakeholders on allocation of cash resources.

“We intend to redeem the outstanding October FCCBs at the end of the proposed four-month extension, subject to requisite approvals,” a company spokesperson said in a statement.

Suzlon issued USD 200 million zero coupon convertible bonds and USD 20.8 milllion worth convertible bonds having a coupon rate of 7.5 percent. These are due in October.

According to the statement, the meetings of the bond holders are proposed to be held on October 10.

“We are actively working on various sources of funding; including from the sale of non-critical assets, fresh debt, equity-linked and/or equity fund raising through the domestic and international capital markets, and additional secured leverage at an international subsidiaries-level by optimally re-balancing our debt across various assets,” it said.

The spokesperson said these initiatives would enable the company to optimally allocate resources between business requirements and debt obligations “in a manner that will allow us to obtain relevant approvals from our senior secured lenders”.

Suzlon’s net debt touched Rs 11,165 crore at the end of March 2012.

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Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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