Gensol Engineering Ltd finds itself deep in troubled waters as its shares plunged 5% in Wednesday’s trade, hitting a fresh 52-week low of ₹123.65. This marks an 84% decline in the stock’s value so far in 2025. The sharp fall comes in the wake of a Securities and Exchange Board of India (SEBI) order barring Gensol and its promoters—Anmol Singh Jaggi and Puneet Singh Jaggi—from participating in the securities market. The action was taken due to serious allegations of fund diversion and corporate governance lapses. SEBI also froze the company’s proposed 1:10 stock split, announced last month, citing investor protection concerns amidst ongoing investigations.
According to SEBI, Gensol’s promoters allegedly misused hundreds of crores raised for electric vehicle (EV) procurement, diverting funds to purchase luxury properties and make questionable transactions with related entities. Between FY22 and FY24, Gensol raised ₹977.75 crore in loans from IREDA and PFC to acquire 6,400 EVs for leasing to BluSmart, its parent company. However, supplier Go-Auto confirmed that only 4,704 EVs worth ₹567.73 crore were delivered, leaving ₹262 crore unaccounted for. SEBI traced a financial trail showing that Gensol transferred funds to Go-Auto, which then redirected money to firms closely linked to the promoters, such as Capbridge Ventures LLP, Matrix Gas, and Wellray Solar.
In one instance, ₹50 crore was moved from Go-Auto to Capbridge on the same day Go-Auto received money from Gensol. Within three days, Capbridge used ₹42.94 crore to purchase a luxury apartment in The Camellias, Gurugram, a property originally booked by the CEO’s mother, Jasminder Kaur. The booking amount of ₹5 crore also originated from Gensol’s funds. Additionally, Puneet Jaggi reportedly used ₹13.5 crore routed through similar channels for personal expenses, including American Express card payments and family transfers. SEBI also highlighted false disclosures by the company, including inflated pre-order claims and presenting non-binding agreements as confirmed business deals.
Analysts have strongly advised investors to avoid the stock. Gaurang Shah, Senior Vice President at Geojit Financial, stressed the importance of choosing quality over quantity in equities, while Gaurav Sharma of Globe Capital recommended exiting the stock entirely, citing its weak technicals. The stock remains locked in lower circuits, leaving investors unable to liquidate their holdings. Ravi Singh, SVP at Religare Broking, noted that the stock is deeply oversold but warned that further corrections are likely amid persistent negative sentiment.
To make matters worse, Gensol recently scrapped its plan to acquire 2,997 EVs from Refex Green Mobility Ltd. Furthermore, credit rating agencies have issued severe downgrades. ICRA downgraded Gensol’s loan facilities worth ₹2,050 crore, including term loans and cash credit, from [ICRA]BBB- to [ICRA]D, indicating default risk. CARE Ratings echoed this, downgrading ₹716 crore worth of bank facilities to CARE D. For context, a ‘D’ rating signifies that the company may be unable to meet its loan obligations.
In summary, Gensol is facing a storm of regulatory scrutiny, financial mismanagement, credit downgrades, and eroding investor confidence. Market experts agree that the stock is unsuitable for portfolio inclusion and recommend caution, if not complete avoidance.
