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Gensol Engg slumps as SEBI unplugs promoters over alleged fraud

17-Apr-25 14:08 Hrs IST

The stock is currently locked at its 52-week low, having nosedived an astonishing 85% over the past three months.

The meltdown follows a damning interim order issued by SEBI on 15 April 2025, which accused Gensol's promoters ' Anmol Singh Jaggi and Puneet Singh Jaggi ' of diverting massive funds meant for electric vehicle procurement. In response to the findings, the regulator has barred both promoters from taking up any directorial or key managerial positions and restricted their access to the securities market. Subsequently, both Anmol and Puneet stepped down as directors of the company.

SEBI's probe, which was initiated after a complaint in June 2024, unearthed significant misuse of Rs 977.75 crore in loans secured from IREDA and PFC. These funds were meant to finance the purchase of 6,400 electric vehicles. However, only 4,704 EVs were actually acquired, leaving over Rs 207 crore unaccounted for. The investigation revealed that funds were routed through entities like Go-Auto and Capbridge Ventures, many of which had links to the promoters. A portion of the money was allegedly used for personal indulgences, including a luxury apartment at Gurgaon's DLF Camellias and a Rs 26 lakh golf set.

In addition to fund diversion, SEBI flagged falsified documents submitted to credit rating agencies, further misleading investors and lenders. The regulator is now appointing a forensic auditor to comb through the company's books and transactions, extending the probe to Gensol's related entities as well.

In a stock exchange filing, Gensol said it will extend full cooperation during the forensic audit and pledged transparency throughout the process. The company is committed to providing the auditor with complete access to records and information to ensure a transparent and comprehensive audit process, the clarification read.

Acknowledging the reputational damage and stock volatility triggered by the SEBI proceedings and media coverage, Gensol said it remains focused on stabilizing its operations. The company also clarified that it is not currently engaged in any undisclosed mergers, acquisitions, or major transactions.

In an interim order, SEBI whole time member Ashwani Bhatia also directed Gensol to put its proposed 1:10 stock split on hold. SEBI suspects that it was likely to attract more retail investors to the scrip.

Gensol Engineering is a renewable energy company specializing in solar power EPC services and electric mobility solutions. The company's consolidated net profit rose 32.52% to Rs 16.91 crore on a 56.42% increase in revenue to Rs 344.51 crore in Q3 FY25 over Q3 FY24.