Debts, forced recalls and Tanti’s inorganic dreams. Is Suzlon going to make it through? Asks Ratan Lal Bhagat
“The closer we get to this new energy future, the harder the opposition is going to fight,” professed Barack Obama, President of the United States of America, while explaining the future and challenges of alternative energy, a fortnight back in Florida. While on one hand, Obama is playing the ‘Change we need’ tune to the galleries, on the other, he is being audibly discreet about the “challenges” that stare at the face of corporations and masses alike, that intend to walk down the seemingly narrow ‘alternative energy’ lane; and who better than Tulsi Tanti, the owner-Chairman of Suzlon, the largest wind turbine supplier in the country and the third largest in the world (post its acquisition of REpower) can appreciate this hard-to-swallow truth? For the moment, Tanti’s dream path is strewn with troubles galore. Whether it be disquietness in the name of a financial crunch or the manner in which it was forced to recall wind blades sold in First World economies or the stuck-up acquisition of REpower, the cash-strapped wind turbine manufacturer Suzlon, has been cornered from all sides. And while it shows the cracks in Suzlon’s business fundamentals have now started becoming more prominent as that on its blades, the question for the moment remains – will Suzlon survive the dust-storm or will it be forced to bite the dust? Especially considering that many experts still feel that although the coming decade looks bright for those wanting to hedge their luck on alternative energy sources, the huge costs associated with it makes it a weak proposition for the moment.
The ghost which is haunting Suzlon was born out of its book of accounts. The company has been posting monumental losses in the three quarters gone by, having recorded Rs.4.35 billion and Rs.3.35 billion in the quarters ended June and September 2009 respectively (and that is without considering losses due to forex fluctuations). Then there is the overambitious Tanti, whose inorganic dreams have further aggravated the situation for Suzlon, thus overstretching its loan liabilities. Today, the debt-laden Suzlon owes about Rs.134.77 billion to its creditors (domestic loans of about Rs. 100 billion and about $700 million of foreign currency loans).
“The closer we get to this new energy future, the harder the opposition is going to fight,” professed Barack Obama, President of the United States of America, while explaining the future and challenges of alternative energy, a fortnight back in Florida. While on one hand, Obama is playing the ‘Change we need’ tune to the galleries, on the other, he is being audibly discreet about the “challenges” that stare at the face of corporations and masses alike, that intend to walk down the seemingly narrow ‘alternative energy’ lane; and who better than Tulsi Tanti, the owner-Chairman of Suzlon, the largest wind turbine supplier in the country and the third largest in the world (post its acquisition of REpower) can appreciate this hard-to-swallow truth? For the moment, Tanti’s dream path is strewn with troubles galore. Whether it be disquietness in the name of a financial crunch or the manner in which it was forced to recall wind blades sold in First World economies or the stuck-up acquisition of REpower, the cash-strapped wind turbine manufacturer Suzlon, has been cornered from all sides. And while it shows the cracks in Suzlon’s business fundamentals have now started becoming more prominent as that on its blades, the question for the moment remains – will Suzlon survive the dust-storm or will it be forced to bite the dust? Especially considering that many experts still feel that although the coming decade looks bright for those wanting to hedge their luck on alternative energy sources, the huge costs associated with it makes it a weak proposition for the moment.
The ghost which is haunting Suzlon was born out of its book of accounts. The company has been posting monumental losses in the three quarters gone by, having recorded Rs.4.35 billion and Rs.3.35 billion in the quarters ended June and September 2009 respectively (and that is without considering losses due to forex fluctuations). Then there is the overambitious Tanti, whose inorganic dreams have further aggravated the situation for Suzlon, thus overstretching its loan liabilities. Today, the debt-laden Suzlon owes about Rs.134.77 billion to its creditors (domestic loans of about Rs. 100 billion and about $700 million of foreign currency loans).
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
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An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)
