Shares of Gensol Engineering crashed to an all-time low on Wednesday, April 16, 2025, as the Securities and Exchange Board of India (SEBI) took stringent action against the company’s promoters, Anmol Singh Jaggi and Puneet Singh Jaggi. The stock plummeted 5% to ₹122.68 on the National Stock Exchange (NSE), marking a significant downturn amid serious allegations of financial misconduct.
In a strongly worded interim order, SEBI has barred the Jaggi brothers from accessing the securities market and from holding any directorial or key managerial positions within Gensol Engineering until further notice. The regulator's investigation revealed alarming details regarding the misutilization and diversion of funds raised for business expansion, particularly for the purchase of electric vehicles.
According to SEBI, over ₹200 crore was allegedly funneled through a car dealer and redirected to entities linked to the Jaggi brothers, raising concerns that these funds were used for personal luxuries, including luxury real estate. SEBI's order stated, "The prima facie findings have shown misutilisation and diversion of funds of the company (GEL) in a fraudulent manner by its promoter directors, Anmol Singh Jaggi and Puneet Singh Jaggi, who are also the direct beneficiaries of the diverted funds."
The market watchdog also found that Gensol Engineering had submitted forged documents to credit rating agencies, attempting to create a false narrative regarding timely loan repayments. Gensol had raised loans amounting to ₹975 crore from institutions like IREDA and PFC, but only a fraction of these funds was reportedly utilized for their intended purpose.
In light of these findings, SEBI has directed Gensol Engineering to put its recently announced stock split plan on hold. The split, which was set at a ratio of 1:10, was intended to attract more retail investors. However, SEBI expressed concerns that allowing this corporate action could mislead investors amid ongoing governance lapses.
Gensol Engineering's share price has been on a downward spiral, reflecting a staggering 84% drop since the beginning of 2025 and an almost 87% decline over the past year. The stock, which once reached a 52-week high of ₹1,124.90, has now hit a low of ₹122.68, resulting in a market capitalization that has fallen to around ₹498.35 crore.
SEBI's investigation was prompted by a complaint received in June 2024, alleging serious governance issues, fund diversion, and submission of falsified documents. The regulator's order noted, "...prima facie evidence of a blatant violation of rules of corporate governance is writ large over the workings of the company."
As part of the ongoing scrutiny, SEBI has mandated the appointment of a forensic auditor to examine the books of accounts of Gensol and its related parties. This audit is expected to shed light on the extent of the financial irregularities and ensure transparency in the company’s dealings.
The fallout from these developments extends beyond Gensol Engineering itself. The Jaggi brothers are also co-founders of BluSmart, India's first all-electric ride-hailing service. The adverse order against them is likely to impact BluSmart's operations, particularly as the company has been struggling to secure new funding despite raising approximately ₹1,245 crore in 14 funding rounds.
Analysts are advising caution regarding Gensol's stock. The company, once viewed as a high-growth player in the solar engineering, procurement, and construction (EPC) sector, now faces a credibility crisis. With a significant drop in promoter shareholding from 70.72% in FY20 to just 35% in FY25, investor confidence has waned.
As Gensol Engineering continues to grapple with these challenges, the future remains uncertain. Investors are left to ponder whether the company can recover from this scandal and restore its reputation in the market. Until there is clarity on the ongoing investigations and financial health, many experts recommend steering clear of Gensol's stock.
The company, established in 2012 by Anmol and Puneet Singh Jaggi, specializes in providing end-to-end EPC services for solar power projects globally. However, the recent allegations and regulatory actions have cast a long shadow over its operations and future prospects.
