Gensol Engineering Under Multi-Agency Scrutiny

Gensol Engineering Ltd., one of the leading renewable energy companies in India, currently comes under heavy scrutiny from three different regulatory agencies in the country, namely the Securities and Exchange Board of India (SEBI), the Enforcement Directorate (ED), and the National Financial Reporting Authority (NFRA). There are several points of investigation that include diversion of funds, lapses in governance, and financial mismanagement by the promoter duo of the company, Anmol Singh Jaggi, and Puneet Singh Jaggi.

SEBI barred the Jaggi brothers from holding key positions in Gensol and running the company as well as entering the arena of the securities market due to the alleged misappropriation of funds and non-repayment of loans of approximately ₹9.78 billion borrowed from the Indian Renewable Energy Development Agency (IREDA) and from Power Finance Corporation (PFC). The money primarily was used for buying electric vehicles for BluSmart, the EV ride-hailing startup co-founded by these Jaggi brothers.

The ED has searched the offices of Gensol in Delhi, Gurugram, and Ahmedabad under the provisions of FEMA (Foreign Exchange Management Act) and placed Puneet Singh under custody; his brother, Anmol Singh Jaggi, is reported to be somewhere in Dubai.

After SEBI’s referral, the NFRA has also started an investigation against the company’s financial practices.

Meanwhile, during this time, several independents have resigned from the board of Gensol, citing concerns for governance. Additionally, BluSmart Mobility has temporally suspended bookings on its application.

Over 80% decline in stock price from March speaks volumes for Gensol, the promoters’ stake decreasing to 35%, and most of this amount is pledged.

The event brings home again the importance of corporate governance and regulatory oversight within the rapidly growing renewable energy market in India.

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