Gensol Engineering Shares Plunge 55% in March: Investor Confidence Shaken Amid Bulk Deals & Financial Woes
Stock Takes a Hit Following Bulk Deals
Shares of Gensol Engineering continued their downward spiral, shedding 4% on March 30, following a series of bulk deals on March 19. The stock, which had hit a 5% upper circuit in the previous session, has been witnessing relentless selling pressure, closing in the red in 16 out of the last 17 trading sessions.
The bulk deals saw Cinco Stock Vision LLP acquiring 3,00,000 shares at an average price of ₹224.90. Meanwhile, on the selling side:
- KLJ Plasticizers Limited offloaded 3,00,000 shares at ₹248.50
- M M Ceramics and Ferro Alloys sold 2,05,000 shares at ₹231.30
- Mansi Share and Stock Advisors Pvt Ltd both bought and sold shares, disposing of 2,20,093 shares at ₹224.91 while purchasing only 54 shares at ₹244.91
- Virtue Financial Services Private Limited sold 2,00,000 shares at ₹224.90
The mix of buying and selling activity reflects divided investor sentiment, with transaction prices ranging from ₹224.90 to ₹248.50.
Stock Performance: A 55% Decline in March Alone
The stock hit an intraday low of ₹238.00 following the bulk deals. Gensol Engineering is now trading 79% below its all-time high of ₹1,125.75, recorded in June 2024. The continuous downtrend also led to a fresh 52-week low of ₹224.45 in the previous session.
The stock has been on a freefall for four consecutive months, witnessing:
- A 55% decline in March
- A 27% drop in February
- A 2.5% fall in January
- A 5% decline in December
Over the last one year, the stock has lost over 70% of its value, leading to a significant erosion of investor wealth.
Financial Concerns & Management Instability Impacting Sentiment
Investors remain cautious amid financial challenges faced by Gensol Engineering. The company has been struggling with loan repayment delays, while allegations of falsified debt servicing documents have triggered credit rating downgrades by ICRA and CARE Ratings.
Additionally, the sudden resignation of the company’s CFO has further deepened uncertainty, raising questions about internal financial management.
To address liquidity concerns, Gensol’s board recently approved a ₹600 crore fundraising plan, which includes:
- ₹400 crore via Foreign Currency Convertible Bonds (FCCBs)
- ₹200 crore through the issuance of warrants to promoters
To further reduce its debt burden, the company has initiated asset sales, including:
- Selling 2,997 electric vehicles valued at ₹315 crore
- Selling a wholly owned subsidiary for ₹350 crore
These measures aim to improve liquidity and stabilize the company’s financial position.
Promoters Sell Shares to Reinvest in the Business
To unlock liquidity, Gensol’s promoters recently sold 9,00,000 shares (2.37% of total equity). The company clarified that the entire proceeds from this sale, or possibly more, would be reinvested into the business through an equity infusion.
After this transaction, promoters now hold a 59.70% stake in the company. The reinvestment is expected to strengthen the balance sheet and support business growth.
Future Plans: Stock Split & Additional Fundraising on the Horizon
Looking ahead, Gensol Engineering has signaled more corporate actions, including a potential stock split and additional fundraising measures. The company plans to explore:
- Further equity issuance
- Additional FCCBs
- Other financial instruments
These proposals will be discussed in the upcoming board meeting on March 13.
Company Overview: Gensol Engineering
Founded in 2012, Gensol Engineering is a leading Engineering, Procurement, and Construction (EPC) services provider in the solar power sector. The company was listed on NSE and BSE in 2023.
Financial Ratios
| Metric | Value |
|---|---|
| Market Price (March 30, 2025) | ₹238.00 |
| 52-Week High | ₹1,125.75 |
| 52-Week Low | ₹224.45 |
| March 2025 Decline | 55% |
| Annual Decline | 70% |
| Promoter Holding | 59.70% |
| Fundraising via FCCBs | ₹400 crore |
| Fundraising via Warrants | ₹200 crore |
| Debt Reduction Measures | ₹665 crore (Asset Sales) |
Q&A: Quick Insights for Readers
Q1: Why did Gensol Engineering’s stock fall 4% on March 30?
The stock dropped 4% following multiple bulk deals on March 19, where several institutional investors bought and sold large chunks of shares.
Q2: How much has Gensol Engineering declined in March so far?
The stock has fallen by 55% in March alone, making it one of the worst-performing months in its trading history.
Q3: What financial concerns are affecting investor sentiment?
Gensol is facing loan repayment delays, credit rating downgrades, and allegations of falsified debt servicing documents, causing investors to lose confidence.
Q4: How is the company addressing its financial crisis?
To improve liquidity, Gensol has announced:
- ₹600 crore fundraising (₹400 crore via FCCBs and ₹200 crore via warrants)
- ₹665 crore worth of asset sales
Q5: What impact has the promoter share sale had?
Promoters sold 9,00,000 shares (2.37% of total equity) but have pledged to reinvest the proceeds, ensuring capital support for the company.
Q6: What future plans has Gensol Engineering announced?
The company is considering a stock split and additional fundraising measures, which will be discussed in its next board meeting on March 13.
Q7: How much has the stock fallen from its all-time high?
The stock is now trading 79% below its peak price of ₹1,125.75, recorded in June 2024.
Q8: What is Gensol Engineering’s core business?
Gensol Engineering specializes in EPC services for the solar power sector and was listed on the stock exchanges in 2023.
Final Thoughts
Gensol Engineering is facing one of its toughest financial phases, with the stock losing over 70% in a year. While the company is taking steps to reduce debt, raise funds, and strengthen its financials, investors remain cautious amid ongoing uncertainties. The upcoming March 13 board meeting will be a key event to watch as the company charts its revival strategy.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.