Markets regulator SEBI has pulled up Gensol Engineering for allegedly misleading investors, misappropriating funds, and fabricating claims about its electric vehicle (EV) manufacturing operations. In an interim order issued on April 15, SEBI highlighted serious lapses in disclosures and financial conduct by the company and its promoters, Anmol Singh Jaggi and Puneet Singh Jaggi.
A surprise inspection by the National Stock Exchange (NSE) on April 9 at Gensol’s EV plant in Chakan, Pune, found no manufacturing activity and only 2-3 labourers present. Electricity bills over the past year showed minimal consumption, further raising doubts about the company’s operations.
Gensol had earlier claimed, via a stock exchange filing on January 28, that it had secured pre-orders for 30,000 electric vehicles showcased at the Bharat Mobility Global Expo 2025. However, SEBI’s investigation found these were merely non-binding MoUs with nine entities, lacking key details like pricing and delivery schedules.
Another questionable claim came from Gensol’s January 16 disclosure about a strategic tie-up with Refex Green Mobility Ltd for the transfer of 2,997 EVs. The deal, which involved a loan transfer of Rs 315 crore, was later called off in March.
SEBI also flagged a February 25 announcement of a Rs 350 crore strategic deal involving the sale of Gensol’s US subsidiary, Scorpius Trackers Inc, which was only incorporated in July 2024. Gensol failed to justify the valuation when questioned.
The probe revealed that Gensol secured Rs 977.75 crore in loans from IREDA and PFC between FY22 and FY24, with Rs 663.89 crore earmarked for purchasing 6,400 EVs. However, only 4,704 vehicles were actually procured, resulting in a gap of Rs 262.13 crore. SEBI alleges that this unaccounted-for amount was diverted for personal use by the Jaggi brothers, including buying luxury property and funding family-linked entities.
As a result, SEBI has barred the Jaggi brothers from holding any directorship or key managerial role in Gensol and prohibited them from accessing the securities market. The company has also been directed to halt its proposed 1:10 stock split.
Following SEBI’s action, the Jaggi brothers stepped down from their roles as company directors.