Gensol Engineering Ltd. has been thrust into controversy as its promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, resigned from their leadership positions following an interim order by the Securities and Exchange Board of India (SEBI).
The regulatory action stems from allegations of fund diversion and governance lapses, which have led to severe financial and reputational consequences for the company.
An exchange filing confirmed the resignations, effective May 12, 2025, bringing a significant leadership shake-up to the beleaguered firm.
SEBI’s Allegations on Gensol Engineering and Regulatory Action
SEBI’s April 15, 2025, interim order barred Gensol Engineering and its promoters from accessing the securities market, citing large-scale financial misconduct.
The regulator accused the Jaggi brothers of misusing company funds, redirecting them into personal ventures, shell entities, and luxury real estate investments.
The 29-page SEBI order outlined a complex web of fund diversions, including:
- Misuse of loans raised for electric vehicle (EV) procurement.
- Forged documents submitted to mislead investors and rating agencies.
- Circular fund flows between Gensol and related entities.
SEBI also blocked Gensol’s proposed stock split, warning that it could mislead investors amid ongoing financial scrutiny.
Gensol Engineering Promoters’ Resignation and Market Fallout
In their resignation letters, Anmol and Puneet Singh Jaggi cited SEBI’s directive as the reason for stepping down.
The move comes after the Securities Appellate Tribunal (SAT) denied interim relief to Gensol, reinforcing the severity of the allegations.
Following the announcement, Gensol’s stock plummeted, hitting a 52-week low on both BSE and NSE.
The company’s market capitalization has dropped by nearly 90%, wiping out ₹3,800 crore in investor wealth.
Financial Misconduct and Forensic Audit
SEBI’s investigation revealed that Gensol had raised ₹977 crore in loans from state-owned lenders like IREDA and PFC to expand its EV fleet.
However, only 4,700 EVs were purchased, leaving ₹262 crore unaccounted for.
A forensic audit is now underway to examine the extent of financial irregularities, with SEBI warning that the alleged misconduct is “just the tip of the iceberg.”
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