Gensol Engineering Share Price Drop 4% After Bulk Deals

Gensol Engineering share price fell 4% on March 30, following multiple bulk deals a day earlier. The stock had hit its 5% upper circuit in the previous session but has faced consistent selling pressure, closing lower in 16 of the last 17 sessions.

Bulk Deals and Trading Activity

On March 19, the stock saw heavy trading activity due to bulk deals:

• Buyer: Cinco Stock Vision LLP purchased 3,00,000 shares at ₹224.90.
• Sellers: KLJ Plasticizers Limited sold 3,00,000 shares at ₹248.50, while M M Ceramics and Ferro Alloys offloaded 2,05,000 shares at ₹231.30.
• Mixed Transactions: Mansi Share and Stock Advisors Pvt Ltd both bought and sold shares, selling 2,20,093 shares at ₹224.91 and buying just 54 shares at ₹244.91.
• Additional Seller: Virtue Financial Services Private Limited sold 2,00,000 shares at ₹224.90.

This activity indicates mixed investor sentiment, with prices ranging from ₹224.90 to ₹248.50.

Sharp Decline in Stock Price

After the bulk deals, Gensol share price dropped 4% to ₹238.00, nearly 79% below its all-time high of ₹1,125.75 in June 2024. It also hit a 52-week low of ₹224.45 in the previous session.

The stock has been on a continuous decline, losing 55% in March alone, after falling:

• 27% in February
• 2.5% in January
• Over 5% in December

Over the last year, the stock has lost more than 70% of its value, eroding investor confidence.

Financial Troubles and Leadership Concerns

Investor concerns have grown due to the company’s delayed loan payments and allegations of falsified debt servicing documents, which led to credit rating downgrade by ICRA and CARE.

Adding to the uncertainty, the Chief Financial Officer (CFO) resigned, shaking investor trust further. To improve its financial health, Gensol’s board approved:

• Raising ₹400 crore through Foreign Currency Convertible Bonds (FCCBs).
• Issuing ₹200 crore worth of warrants to promoters.

Asset Sales to Reduce Debt

To cut debt, Gensol announced the sale of:

• 2,997 electric vehicles worth ₹315 crore
• A wholly owned subsidiary for ₹350 crore

Promoters Sell Shares to Reinvest

To generate funds, promoters sold 9,00,000 shares (2.37% of equity), with plans to reinvest the proceeds back into the company. They assured that the funds would be used for business growth and pledged to subscribe to more shares during the June 18, 2024, warrant issuance. After the sale, promoters still hold a 59.70% stake in the company.

Future Plans and Stock Split Proposal

Gensol plans to consider a stock split and explore additional fundraising options, including equity issuance and FCCBs, in its upcoming March 13 board meeting.

About Gensol Engineering

Founded in 2012, Gensol Engineering is part of the Gensol Group and specialises in solar EPC (Engineering, Procurement, and Construction) services. The company was listed on NSE and BSE in 2023.

Conclusion

Gensol Engineering faces a tough phase with heavy losses, financial struggles, and leadership concerns. While fundraising efforts and asset sales aim to stabilise the company, investor confidence remains shaky. The upcoming board meeting on March 13 will be crucial in determining its future course.

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