Multibagger: Penny stock Inox Wind soars 1324% in 4 years; what should investors do now?

In the previous year, Inox Wind has shown impressive growth, with returns increasing by 256 percent. However, in 2024 year-to-date (YTD), the stock has faced some corrections and volatility, resulting in a modest gain of 13.5 percent.

Despite a 3.5 percent decline in June and a 6.3 percent fall in May, domestic brokerage house Axis Securities has initiated coverage on Inox Wind with a ‘buy’ call and a target price of ₹182, indicating a potential upside of over 28 percent.

Inox Wind is a leading provider of wind energy solutions, involved in manufacturing and selling wind turbine generators (WTGs), as well as offering erection, procurement, commissioning, operations and maintenance (O&M), and other related services for WTGs and wind farm development.

Axis Securities highlighted the elimination of interest-bearing debt by Inox Wind Limited (IWL) after a promoter infusion, positioning the company well to capitalize on the growing wind sector in India. The company has a strong market position with a robust order book of 2.7 GW across various customer segments, including Inox Green Energy Services Ltd., which boasts margins exceeding 45 percent.

India’s plans to increase wind power capacity to 75 GW by FY32, up from the current 46 GW, further support Inox Wind’s growth prospects. The company has also adapted technologically by transitioning to higher-capacity turbines and developing new platforms, setting itself up for future advancements in the wind energy sector.

Key factors contributing to Inox Wind’s strong market position include a diversified order book, ramp-up in execution, technological advancement, and improved financial performance. Axis projects significant revenue and profit growth for the company, with a focus on returning to profitability from FY25 onwards.

Promoter fund infusions have resulted in zero interest-bearing debt for Inox Wind, further strengthening its financial position. While the stock has seen some declines in recent months, it remains close to its peak and has shown significant growth from its 52-week low.

Overall, Inox Wind’s strategic approach to market diversification, project execution, and technological innovation position it well for future growth in the wind energy sector. Investors are advised to consult with certified experts before making any investment decisions.