Karvy's reserach report on Inox WindGovernment thrust for renewable energy: The government has set a target of installed wind power capacity of 60,000MW to be attained by FY22E, from the current capacity of 23,500MW. Also re-introduction of accelerated depreciation and Generation Based Incentives (GBI) policy after it was withdrawn in FY13 shows government’s seriousness in achieving the ambitious target of installing 60GW of wind energy. This will create a huge opportunity for the company in the upcoming period. Hence, we expect order inflow to increase at a faster pace during the next few years. We estimate an industry order flow of 3,000-3,500MW per annum as against the current addition of 2,000MW per annum. Robust order book supported by new capacity which came on-stream in the recent past are expected to push the current momentum of growth in top-line and bottom line in the second half of FY16E. Considering these factors, we initiated coverage on Inox Wind and assigned average global peers consensus (Gamesa, Xinjiang and Vesta) for FY16E trading PE multiple of 16x (10% discount to average P/E of global peers) with “BUY” recommendation, representing an upside of 20% in thenext 12-18 months.For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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