Description

SEBI issues confirmatory order against Gensol Engineering Limited and its directors for alleged share price manipulation, fund diversion, and providing falsified documents to credit rating agencies.

Summary

SEBI has issued a confirmatory order against Gensol Engineering Limited and its directors Anmol Singh Jaggi and Puneet Singh Jaggi following allegations of share price manipulation, fund diversion, and corporate governance violations. The action stems from credit rating agencies CARE and ICRA downgrading Gensol’s ratings to ‘D’ in March 2025, citing delayed debt servicing and concerns over falsified documents provided by the company.

Key Points

  • SEBI initiated examination in June 2024 based on complaints regarding alleged share price manipulation and fund diversion
  • Credit rating agencies CARE and ICRA downgraded Gensol’s fund-based and non-fund based credit facilities to ‘D’ rating in March 2025
  • ICRA disclosed that certain documents shared by Gensol regarding debt servicing track record were apparently falsified
  • Gensol allegedly provided falsified Conduct Letters from lenders IREDA and Power Finance Corporation claiming regular debt servicing
  • Company also submitted questionable No Objection Certificate from lenders when requesting rating withdrawal
  • SEBI issued interim order on April 15, 2025 against the company and two directors

Regulatory Changes

This confirmatory order reinforces SEBI’s stringent approach toward corporate governance violations and document falsification by listed companies.

Compliance Requirements

  • Listed companies must ensure accuracy and authenticity of all documents submitted to credit rating agencies
  • Proper debt servicing disclosure and transparency with rating agencies is mandatory
  • Corporate governance standards must be maintained at all times

Important Dates

  • June 2024: SEBI initiated examination based on complaint
  • March 3, 2025: CARE Rating downgraded Gensol’s ratings to ‘D’
  • March 4, 2025: ICRA Limited downgraded Gensol’s ratings to ‘D’
  • April 15, 2025: SEBI issued interim order
  • July 30, 2025: Confirmatory order published

Impact Assessment

This enforcement action significantly impacts Gensol Engineering Limited’s market standing and investor confidence. The ‘D’ rating indicates highest risk of default, severely limiting the company’s access to credit markets. The regulatory action may lead to further restrictions on the company’s operations and trading activities, while setting a precedent for SEBI’s enforcement of corporate governance standards in the renewable energy sector.

Impact Justification

Major regulatory enforcement action involving credit rating downgrades to 'D' category and allegations of document falsification affecting corporate governance