The actions of Gensol Engineering were trapped in the lower circuit after the provisional order approved by the Board of Securities and Exchange of India against their promoters that prohibit them from the markets and occupy key management positions in the company.
The company’s shares closed to ₹ 123.65 in the EEB, having abruptly fallen from the more than ₹ 770 levels seen in January. The action had reached a maximum of 52 weeks of ₹ 1.125.75 in June last year and had a market capitalization of ₹ 4.3 billion rupees. Now, its market capitalization has been reduced to ₹ 470 million rupees.
On Tuesday, Sebi came out with a detailed order in which he described how the founders, Anmol Jaggi and Puneet Jaggi, had diverted loans they had taken to buy electric vehicles, for their own personal use, including an expensive apartment in a luxury project in Gurgaon. The EVs bought by them had to be leased to the related party Blusmart, a transport service that operated in Bangalore and Delhi-NCR.
Boil breach
Gensol had loans of tasks of the Renewable Energy Development Agency of India and Power’s Finance Corporation and breached to make appropriate fees. The Sebi order also pointed out that the behavior letters that were provided by Gensol, Ostensiberty written by the lenders, IREDA and PFC insurance.
“It is a clear case of fraud and falsification, and a police complaint must be presented,” said Shriram Subramanian, founder and MD of the Inguberny Research Services counseling firm.
He added that Sebi and the Ministry of Corporate Affairs must exercise their power to replace the company’s board and appoint professionals to administer it. “The falsification of conduct letters supposedly issued by IREDA and PFC, if established, is equivalent to a serious criminal offense under Indian law,” said Sonam Chandwani, managing partner KS Legal & Associates.
Both IREDA and PFC did not respond to the emails sent by Business line Looking for an answer to developments.
GENSOL clarification
In a statement to exchanges, Gensol Engineering said that while Sebi’s procedures and associated media coverage affected the feeling of investors, “we continue to focus on our commercial objectives and we are working diligently to maintain operational stability and performance.”
He added that after the provisional order of Sebi, the promoters no longer participated in the management of the company. He said he was committed to providing the Forensic Auditor, that Sebi intended to name, “with full access to records and information to guarantee a transparent and integral audit process.”
Ironically, he added: “The company is dedicated to maintaining the highest standards of corporate governance and transparency. We will continue to maintain the immediately informed exchanges about any additional development on the future, in the most future material, in the future material, in the future material, in future obligations.”
In his order, Sebi said: “In the present case, the excellent facie of flagrant violation of corporate governance rules is a great work on the operation of the company.”
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Posted on April 16, 2025