Gensol Engineering shares tank 5% as promoters barred from accessing equity markets, stock split put on hold

Gensol Engineering shared divied 86 percent over the past 12 months.

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

live

• bselive
• nselive

Volume

Todays L/H

More

×

Solar EPC player Gensol Engineering Ltd. (GEL) shares crashed to their five percent lower circuit on April 16, after the market regulator Securities and Exchange Board of India (SEBI) passed an interim order against the firm and its promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, over alleged fund diversion and false disclosures.

The regulator has prohibited the promoters from taking up any directorial or key managerial roles and restricted them from trading in securities. Further, the Jaggi brothers have been barred from accessing the market.

The SEBI order noted, “What has been witnessed in the present matter is a complete breakdown of internal controls and corporate governance norms in Gensol, a listed company. The promoters were running a listed public company as if it were a propriety firm. The company’s funds were routed to related parties and used for unconnected expenses, as if the company’s funds were promoters’ piggybank”.

At close, shares of the firm were quoting Rs 122.68 apiece on the NSE, down five percent.

Follow our market blog to catch all the live updates

In an interim order, SEBI Whole Time Member Ashwani Bhatia also directed GEL to put stock split on hold. On Saturday, company had announced stock split in the 1:10 ratio.

As per the SEBI order, the promoter holding in the GEL has already come down substantially and there is a risk of the promoters further off-loading the shares on gullible investors. Thus, investors need to be made aware of the alleged wrong doings detailed above through regulatory action.

At the same time, allowing promoters to remain at the helm of affairs as directors or Key Managerial Person in the company is likely to do further damage to the interests of the Company. SEBI also suspects that recently announced stock split of shares by GEL in the ratio of 1:10, was likely to attract more retail investors to the scrip.

Shares of Gensol Engineering have been on a steady downward trajectory ever since reports of corporate mismanagement and debt concerns arose. Over the past month, shares of Gensol Engineering crashed 46 percent, while diving 86 percent over the past 12 months.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.