New Delhi, June 11 Investors in the Gensol Engineering Limited (GEL) have suffered a massive loss to the tune of nearly Rs 4,000 crore as the stock of the fraud-hit company sank by more than 95 per cent.
Gensol Engineering's stock closed 2 per cent down at Rs 51.42 on the National Stock Exchange (NSE) on Wednesday. The stock has slipped 95.42 per cent from its all-time high.
In April, the Securities and Exchange Board of India (SEBI) took strict action against Gensol’s top promoters, Anmol Singh Jaggi and Puneet Singh Jaggi. The capital markets regulator barred both from accessing the securities market and from holding key management roles.
The regulator’s investigation revealed that Gensol had diverted funds raised through a loan-financed electric vehicle (EV) purchase scheme.
The SEBI had said that GEL promoters diverted the loan taken to buy electric vehicles (EVs) to buy a luxury apartment in DLF's 'The Camellias' in Gurugram. According to the regulator, loans taken to purchase electric vehicles for ride-hailing service BluSmart were diverted through several entities and later used for personal gain.
The probe further revealed that promoter Anmol Singh Jaggi allegedly transferred company funds to family members and used them for personal purposes. According to the order, Jaggi sent Rs 6.2 crore to his mother and Rs 2.98 crore to his wife. He also purchased luxury items from the company's money, including spending Rs 26 lakh on a golf set, Rs 17 lakh on shopping at Titan, and over Rs 10 lakh on a spa session.
The market regulator found that Gensol Engineering had taken a loan of Rs 978 crore from two government companies, the IREDA and the PFC, between 2021 and 2024. State-run PFC Chairman and Managing Director Parminder Chopra reportedly termed the loan given to Gensol Engineering as a fraud. "Based on our preliminary investigation, we have found this to be a fraud," she said.
Late last month, the National Company Law Tribunal (NCLT) in Ahmedabad ordered the freezing and attachment of all bank accounts and lockers belonging to Gensol Engineering Limited and its associated entities. The action follows a complaint filed by the Ministry of Corporate Affairs (MCA), which has accused the company of serious corporate fraud and financial misconduct.
The aim is to prevent any further misuse of funds or tampering with evidence. The NCLT also stated that there is initial proof suggesting grave misconduct by the company’s promoters.
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