SEBI May Launch Probe into Gensol Engineering

The Securities and Exchange Board of India (SEBI) is likely to initiate an investigation into Gensol Engineering Limited (GEL), a solar EPC company listed in 2019. According to reports, the regulator is looking into alleged irregularities in related-party transactions and potential submission of falsified debt servicing documents to rating agencies.

As of 9:30 AM on April 7, 2025, Gensol Engineering Limited (GEL) share price was trading at ₹154.74, a 5 % down, but down 79.30% over the past 6 months and 83.59% over the past year.

Focus on Related-Party Transactions

One important area under scrutiny is Gensol’s relationship with BluSmart Mobility, a company that shares the same promoters, Anmol Singh Jaggi and Puneet Singh Jaggi. Around 3,000 electric vehicles in BluSmart’s fleet are reportedly owned by GEL through its EV financing arm,

Gensol EV Lease Pvt Ltd. SEBI is examining whether the lease agreements between GEL and BluSmart were structured on fair terms. There is concern that these transactions may have caused a loss to GEL’s minority shareholders.

Ratings Downgraded to Default

Both ICRA and CARE Ratings downgraded GEL’s loan facilities to ‘D’ (default grade) after lenders reported delays in servicing loan obligations. ICRA stated that certain documents shared by GEL on its debt servicing history were “apparently falsified.” The ratings also factored in GEL’s financial linkages with BluSmart, which recently delayed non-convertible debenture payments.

Probe into Accounting and Fund Use

SEBI is also expected to examine GEL’s accounting practices, financial disclosures, and whether there was any diversion of funds raised for EV purchases into promoter-linked entities. The sharp rise in the company’s balance sheet may also be reviewed.

Failed Deal and Financials

GEL recently attempted to sell its EV fleet to a subsidiary of Refex Industries, but the deal did not go through. As per exchange data, promoter holding in GEL stands at 62.65%, with 81.70% of it pledged. The company reported a compound annual profit growth rate of 52.1% over the past five years.

Conclusion

While GEL’s mission is to disrupt the clean energy ecosystem, the current situation demands transparency and accountability. The outcome of SEBI’s possible probe will be crucial in determining whether GEL can power through or dim under governance concerns.

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