Should you buy or sell Suzlon Energy stock after it was trapped at a 5% decline for the second straight day?

 Should you buy or sell Suzlon Energy stock after it was trapped at a 5% decline for the second straight day?

Tuesday after the stock was placed on Direct stage IV "ASM framework" with effect from October 9, Suzlon Energy share price was frozen at 5% lower circuit for the second session in a row. Additional Surveillance Measures is referred to as ASM.

Shares of Suzlon Energy began 4.4% down at 26.46 per share compared to their previous BSE closing of 27.69 per share. But when the selling grew more ferocious in the early deals, the price dropped below a 5% lower circuit limit of 26.31 per share.

Shares of Suzlon are being sold off after the stock was included in the ASM IV framework, which regulates price movement to safeguard investors.

In the last phase, the stock's price range is reduced to 5% while the margin requirement for all clients increases to 100%.

Shares of Suzlon Energy have provided investors with multibagger gains. The stock has increased by more than 230% over the past six months and more than 148% overall (YTD).

The share price of Suzlon Energy has increased by 243% over the past year and by more than 791% over the past three years, providing investors with excellent returns.

Suzlon Energy was given coverage by brokerage company JM Financial in August with a 'Buy' recommendation and a target price of $30 per share. This represents a 14% increase above the current low price.

Suzlon Energy is in the best position to expand its order book and improve project execution in order to benefit from the industry tailwinds, according to JM Financial. Suzlon Energy has a leading market share of 33%, a greater depth of manufacturing (4.5GW), the most reliable O&M services (35%+ EBITDA), and superior technology (3MW sets under testing).

JM Financial anticipates Suzlon Energy to produce revenue and EBITDA CAGRs of 31% and 38% during FY23-26E, respectively, as the firm works toward becoming net-debt free. 

"We expect a strong pick-up in the company's performance going forward," the statement read. "Industry tailwinds are in place, a deleveraged balance sheet, and a robust order book."

Suzlon Energy revealed that its consolidated net profit for the three months ended in June 2023 fell sharply by 96% to 101 crore from 2,433.33 crore in the same period the previous year. 

The renewable company's operating revenue in Q1FY24 fell by 2% to $1,347.52 crore from $1,377.58 crore in the corresponding quarter last year.