Just an initial public offering (IPO) was all that was needed to catapult the promoter of Suzlon into the list of the world’s wealthiest individuals in the five-year bull mania that ended in 2008. Suzlon is among those companies whose credibility had dived along with its market-cap as complaints about the poor quality of its wind turbines made global headlines. In April, rating agency CRISIL kept Suzlon on rating watch with negative implications after a big downgrade. This was due to the big delay in fresh infusion of private equity and a ‘sharp deterioration in gearing’. It says that Suzlon also runs large refinancing and funding risks in 2009-10 due to upcoming payment obligations to Martifer and a foreign currency convertible bond.
The irony is that better business ethics would have seen Suzlon surfing the global economic downturn, since alternative energy remains a hot business segment because of president Barack Obama’s commitment to explore these options.