Gensol Engineering shares hit 5% upper circuit for 4th day

Shares of Gensol Engineering locked in the 5% upper circuit for the fourth consecutive session on Friday, even as the company continues to face regulatory and financial challenges.

The recent rally follows the resignation of Managing Director Anmol Singh Jaggi and Whole-time Director Puneet Singh Jaggi earlier this week. Their exit, effective May 12, came in compliance with an interim order by the Securities and Exchange Board of India (SEBI), which barred them from accessing the securities market.

SEBI crackdown


SEBI's action stems from allegations that the Jaggi brothers siphoned off loan funds from Gensol for personal use, raising red flags over corporate governance at the clean energy firm. The brothers are co-founders of Gensol Engineering and BluSmart Mobility, an EV ride-hailing platform.

Last month, SEBI accused them of financial misconduct, including diverting company money for personal luxury purchases and failing to meet loan repayment obligations related to BluSmart’s electric vehicle fleet.

Insolvency petition filed by IREDA


Adding to Gensol’s troubles, the Indian Renewable Energy Development Agency (IREDA) filed an insolvency petition on May 14, citing a loan default of Rs 510 crore. According to a regulatory filing, the plea was submitted under Section 7 of the Insolvency and Bankruptcy Code.

Gensol had borrowed Rs 977.75 crore from IREDA and Power Finance Corporation (PFC), of which Rs 663.89 crore was earmarked for the procurement of electric vehicles for BluSmart. However, only 4,700 out of the 6,400 sanctioned vehicles were delivered, leaving over Rs 262 crore unaccounted for, SEBI said.

The regulator alleged that the excess funds were diverted to unrelated entities, including real estate transactions and payments to companies linked to the promoters.

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Gensol Engineering stock performance


Despite the ongoing investigations and legal action, Gensol shares have surged more than 15% over the past week. However, the stock is still down 46% in the last month and has lost over 93% of its value in the past year.

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