Gensol Engineering’s chart looks like a staircase that’s spiralling downwards. The company’s share price has fallen by nearly 90% in the past three months and is currently locked at ₹99.91 apiece in a 5% lower circuit.

The Securities and Exchange Board of India (SEBI) has issued an interim order against Gensol Engineering and its promoters, Puneet Singh Jaggi and Anmol Singh Jaggi, restricting their access to the securities markets until further notice. 

The action comes in response to serious concerns over fund misappropriation and weak corporate governance. Additionally, the Jaggi brothers have been barred from holding any director or key managerial positions within the company.

Misuse of Loans and Misleading Disclosures

The investigation, which began following a complaint in June 2024, revealed that Gensol’s promoters had allegedly misused funds and engaged in fraudulent financial practices. 

SEBI highlighted that loans amounting to ₹978 crore, secured from IREDA and PFC, were partially diverted for personal use—including luxury real estate purchases—and for the benefit of individuals closely related to the promoters. 

Furthermore, the company reportedly misled regulatory bodies, lenders, credit rating agencies, and investors by submitting fabricated conduct letters claimed to be issued by its lenders.

Governance Failures and Stock Split Halt

SEBI noted that the promoters were treating the publicly listed company as their own private entity, diverting resources to related parties for non-business activities. 

The regulator emphasized the risks such behaviour poses to shareholders, citing insufficient internal checks that even allowed restricted funds to be misused. As a result of these findings, Gensol has been directed to halt its planned 1:10 stock split.

Stock Crash and Reclassification

The market has already reacted sharply. Gensol Engineering’s stock hit the lower circuit on April 16, 2025, falling by 5% to open at ₹122.68 per share.

Gensol’s share price has plunged approximately 90%, falling from a peak of ₹1,147 to around ₹129. The stock has now been categorised under the ‘T’ group, which enforces mandatory delivery-based trading and limits daily price movements to 5%, restricting intraday and speculative trading like BTST/STBT. 

This sharp decline intensified after credit rating agencies ICRA and CARE downgraded the company. CARE downgraded Gensol to default status, while ICRA flagged delays in debt servicing and questionable governance practices tied to allegedly manipulated debt repayment records.

Gensol Engineering Under ED Spotlight in Mahadev Betting Scandal

Gensol Engineering is facing serious scrutiny from the Enforcement Directorate (ED) over its suspected links to the Mahadev Book app — a massive illegal betting and money laundering network. The ED plans to question Gensol’s promoters, Anmol and Puneet Singh Jaggi, as part of the probe.

Over 500,000 company shares, previously held by Dubai-based Zenith Multi Trading (connected to an accused in the case), have been frozen. Authorities believe these shares were part of a stock manipulation scheme involving illicit funds routed through foreign portfolio investors. The ED has also attached assets worth ₹573 crore tied to the scam, while continuing to trace the movement of laundered money through offshore investments and cryptocurrency.

Sebi Flags Serious Financial Irregularities at Gensol

Alongside the ED probe, market regulator Sebi is investigating Gensol for possible financial fraud and misleading public disclosures. According to Sebi’s interim order, the company’s claimed EV operations at its Pune facility were largely inactive — with only a few workers and barely any electricity usage observed during a site visit.

The much-hyped 30,000 EV pre-orders were found to be vague agreements with no pricing or delivery timelines. Sebi also flagged a questionable deal with Refex Green Mobility and raised concerns over the inflated valuation of a U.S. subsidiary. Shockingly, out of ₹977 crore in loans raised by the company, more than ₹260 crore appears to be unaccounted for, with funds allegedly diverted for luxury expenses and linked-party transactions.

Promoter Ban and Operational Fallout

In light of these developments, Sebi has barred the Jaggi brothers from holding any executive or market-related positions. This regulatory action has triggered wider fallout, especially for Gensol’s affiliate BluSmart, which has now suspended its electric cab services.

Meanwhile, the Mahadev betting investigation continues to expand. So far, 13 arrests have been made, assets worth over ₹3,000 crore have been seized, and 74 entities have been named. As the crackdown deepens, Gensol Engineering remains at the centre of a storm involving market manipulation, illegal funds, and regulatory violations.

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