Gensol Engineering's 5% lower circuit streak continues as promoters resign

Shares of Gensol Engineering continued to see no takers as the stock hit another 5 per cent lower circuit on Tuesday after Anmol Singh Jaggi and Puneet Singh Jaggi resigned, following the market regulator's interim order.

 

Since March 21 this year, the stock of the beleaguered company has been consistently hitting the lower circuit every session. During Tuesday's trade, the counter tumbled to an intraday low of ₹51.25 per share. From its peak of ₹1,331 apiece in February last year, the stock has fallen by nearly 96 per cent. 

 

The stock has tumbled 93 per cent this year, compared to a 4.5 per cent advance in the benchmark Nifty 50. The market capitalisation of Gensol Engineering has plunged to ₹197 crore, from its peak of ₹4,131 crore last year. 

 

Promoters quit after Sebi order 

 

Promoters Anmol Singh Jaggi and Puneet Singh Jaggi resigned from the company following the Securities and Exchange Board of India's interim order. Anmol Singh Jaggi held the post of Managing Director while Puneet Singh Jaggi was a Whole-time Director.

 

Earlier on April 15, the Securities and Exchange Board of India (Sebi) barred Gensol Engineering and promoters Anmol Singh Jaggi and Puneet Singh Jaggi from the securities markets till further orders in a fund diversion and governance lapses case.

 

The regulator also debarred Anmol and Puneet Singh Jaggi from holding the position of a director or key managerial personnel in Gensol until further orders. The markets watchdog also directed Gensol Engineering Ltd to put on hold the stock split announced by it. 

 

Back-to-back hit for Gensol

 

In recent developments, the Delhi High Court on Wednesday barred Gensol Engineering and its all-electric ride-hailing subsidiary BluSmart Mobility from transferring or selling over 220 electric vehicles (EVs) leased from SMAS Auto Leasing India Pvt Ltd and Shefasteq OPC Pvt Ltd.

 

Further, the corporate affairs ministry has ordered a probe into the affairs of crisis-hit Gensol Engineering and BluSmart Mobility for alleged violations of company law. 

 

Why is Gensol under the scanner?

 

In April, Sebi barred Anmol Singh Jaggi and Puneet Singh Jaggi from the securities market, allegedly for diversion of funds and fraudulent practices. 

 

Further, the market watchdog directed Gensol Engineering to put on hold the stock split announced by it. Sebi said that the funds were used for luxury real estate, complex fund routing, and alleged misuse of public company money as if it were a private purse.

 

Sebi started scrutinising the case after multiple complaints and subsequent downgrades of Gensol's credit ratings by CARE Rating and Icra due to delays in servicing debt obligations by BluSmart Mobility, a related party of Gensol.