₹1,125 to ₹184: Solar stock crashes more than 80% amid major financial concerns

During Friday’s trading session, the shares of a leading player in India’s renewable energy sector hit a 52-week low on the stock exchanges. The stock has crashed by over 76 percent in 2025 so far. The company is engaged in the business of solar consulting, Engineering, Procurement, and Construction (EPC), along with electric mobility solutions.

This article focuses on Gensol Engineering Limited, which has been making headlines due to its significant stock decline. Below are some key events that contributed to its recent downfall

Price Movement

With a market cap of Rs. 700 crores, the shares of Gensol Engineering Limited hit a 5 percent lower circuit at Rs. 184.25 on BSE, as against its previous closing price of Rs. 193.9. The stock hit its 52-week high at Rs. 1,125.75 on 24th June 2024, and compared to current price levels of Rs. 184.25, the stock is trading at a discount of nearly 84 percent.

What went wrong?

CARE Ratings downgrade: In early March 2025, both CARE Ratings and ICRA downgraded Gensol Engineering’s long-term and short-term bank facilities from BB+ (Stable) to ‘CARE D’— a credit rating given to issuers who are in default or expected to be in default. This was due to ongoing delays in servicing term loan obligations. ICRA also reported that certain documents provided by Gensol regarding its debt servicing track record were falsified, raising corporate governance issues.

Fundraising & Asset Divestment Plans: In response, Gensol Engineering acknowledged the rating downgrade and announced a debt reduction plan. The company’s board approved several measures, including raising Rs. 400 crore through Foreign Currency Convertible Bonds (FCCBs), issuing warrants worth Rs. 200 crore to promoters, and divesting assets such as selling 2,997 EVs valued at Rs. 315 crore and a wholly owned subsidiary for Rs. 350 crore.

Resignation of Key Personnel: The company’s Chief Financial Officer, Ankit Jain, resigned in March 2025, citing personal reasons and a desire to explore other career opportunities. This departure added to investor concerns about the company’s stability.

Leadership Turmoil at BluSmart: Gensol’s close association with BluSmart Mobility, a company undergoing significant restructuring, has also contributed to the negative sentiment. High-profile exits of key executives, including the CEO and other senior leaders, have raised alarms among investors about the stability and future direction of BluSmart, which is integral to Gensol’s operations.

Controversial Leasing Deal: Gensol is involved in a contentious leasing arrangement where it plans to sell nearly 2,997 EVs to Refex Green Mobility, which will then lease them back to BluSmart. This deal, valued at Rs. 315 crore, has yet to receive regulatory approval and has added to investor concerns regarding Gensol’s operational strategy and financial health.

Promoter Stake Sell: The company’s CEO, Anmol Singh Jaggi, had sold around 2.15 lakh equity shares at a share price of Rs. 533.1 per share, amounting to Rs. 11.46 crore through an Open Market transaction.

Earlier, the Promoter Group, including Anmol Singh Jaggi (Chairman and Managing Director), Gensol Ventures, and Puneet Singh Jaggi, pledged shares from December 2024. By the end of December 2024, around 81.7 percent of the promoters’ shares were pledged, up from 42.78 percent at the end of December 2023.

Also read: Penny stock skyrockets 15% after receiving order from Tata Steel for transportation of steel products

Financials

Gensol Engineering reported a significant growth in revenue from operations, experiencing a year-on-year increase of nearly 57 percent, rising from Rs. 220 crores in Q3 FY24 to Rs. 345 crores in H1 FY25.

Similarly, the company’s net profit increased from Rs. 12 crores to Rs. 18 crores over the same period, representing a slight growth of around 50 percent YoY. Additionally, during the same time frame, its operating expenses also increased by about 75.2 percent YoY from Rs. 157 crores to Rs. 275 crores.

Key Financial Ratios

In terms of key financial metrics, Gensol Engineering has a Return on Equity (RoE) of 20.1 percent and a return on capital employed (RoCE) of 14.3 percent. Additionally, the stock has a P/E ratio of 8.1, compared to the industry’s P/E ratio of 30.9, and its debt-to-equity ratio stands at 2.33.

Written by Shivani Singh

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