Suzlon Shares Drop 4.2% as Director Resigns Over Governance Issues; Q4 Profit Falls 21%

Suzlon Energy’s shares fell 4.2% after Independent Director Marc Desaedeleer resigned, citing dissatisfaction with corporate governance standards. Despite operational and financial improvements, Desaedeleer highlighted concerns over a lack of transparency. Additionally, Suzlon reported a 21% decline in Q4 net profit to ₹254 crore.

CONTENTS:

• Corporate governance issues prompt resignation
• Profit decline amid governance concerns

Corporate governance issues prompt resignation

Suzlon Shares Drop 4.2% as Director

In his resignation letter to Suzlon Energy CEO Vinod Tanti, Independent Director Marc Desaedeleer cited dissatisfaction with the company’s corporate governance standards, particularly noting a lack of openness and transparency in communication. Despite expressing satisfaction with Suzlon’s operational and financial performance over the past 18 months, Desaedeleer resigned effective June 8 due to these governance issues. Following his resignation, Suzlon Energy’s shares fell, trading 4.2% lower at ₹47.76 on the National Stock Exchange and 4.1% lower at ₹47.7 on the BSE.

Profit decline amid governance concerns

In an exchange filing, Marc Desaedeleer stated that several issues had been discussed, some shared with board members, and he had recently sent a note to CEO Vinod Tanti outlining these concerns, hoping for constructive use of this information. Consequently, Desaedeleer decided to resign as Independent Director and from all associated committee memberships.

Suzlon Energy’s net profit for the March 2024 quarter was ₹254 crore, a decline of nearly 21% from ₹320 crore in the same period last year. For FY24, net profit fell to ₹660 crore from ₹2,887 crore in the previous fiscal year. However, EBITDA increased by 54% to ₹357.2 crore in Q4, up from ₹232.6 crore in Q4 FY23, and total income rose to ₹2,207.4 crore from ₹1,699.9 crore in the year-ago period.