Sebi finds no manufacturing at Gensol’s Pune EV plant, solely 2-3 labourers

In its order, Sebi discovered discrepancies in addition to deceptive disclosures to traders by Gensol Engineering, an organization promoted by brothers Anmol Singh Jaggi and Puneet Singh Jaggi. File
| Photograph Credit score: Reuters

Markets regulator Securities and Change Board of India (Sebi) has mentioned it discovered “no manufacturing exercise” at Gensol Engineering’s electrical automobile (EV) plant in Pune with solely two to a few labourers current when a Nationwide Inventory Change (NSE) official visited the positioning.

These revelations have been a part of markets regulator Sebi’s interim order issued on April 15 following a criticism acquired in June 2024 alleging manipulation of Gensol’s share worth and misappropriation of funds.

In its order, Sebi discovered discrepancies in addition to deceptive disclosures to traders by Gensol Engineering, an organization promoted by brothers Anmol Singh Jaggi and Puneet Singh Jaggi.

One of many disclosures got here from an investigation performed by the NSE, which revealed a scarcity of producing exercise at Gensol’s EV plant — Gensol Electrical Car Non-public Ltd — at Chakan in Pune.

Throughout a web site go to to the power on April 9, an NSE official discovered solely two to a few labourers current.

“It was discovered that there was no manufacturing exercise on the plant with solely 2-3 labourers current there. The NSE official referred to as for particulars of electrical energy payments of the unit and it was noticed that the utmost quantity billed by Mahavitaran over the last 12 months was ₹1,57,037.01 for December 2024.

“Therefore, it may be inferred that there was no manufacturing exercise on the plant web site which is on a leased property,” Sebi revealed in its interim order handed on April 15.

The go to adopted an announcement by Gensol to the inventory exchanges on January 28, 2025, claiming it had acquired pre-orders for 30,000 items of its newly launched EVs showcased on the Bharat Mobility World Expo 2025.

Nevertheless, upon reviewing the paperwork offered by the corporate, Sebi discovered that the orders have been Memorandum of Understandings (MoUs) entered with 9 entities for 29,000 automobiles.

The MoUs have been within the nature of an expression of willingness with no reference to the value of the automobile or supply schedules.

Subsequently, it prima facie appeared that the corporate was making deceptive disclosures to traders, Sebi said.

In one other disclosure dated January 16, 2025, Gensol knowledgeable the exchanges relating to a strategic tie-up with Refex Inexperienced Mobility Ltd “for the switch of two,997 electrical four-wheelers” to Refex.

As part of the tie-up, Refex was to imagine Gensol’s current mortgage of ₹315 crore. Nevertheless, in a disclosure dated March 28, the proposed takeover by Refex was withdrawn.

In one more disclosure dated February 25, 2025, Gensol knowledgeable the exchanges that it had signed a non-binding time period sheet for ₹350 crore for a strategic transaction involving the sale of Gensol’s U.S. subsidiary Scorpius Trackers Inc.

It was famous that the U.S. subsidiary was integrated on July 22, 2024.

When probed by Sebi relating to the idea of such valuation of ₹350 crore, Gensol didn’t submit any clarification or rationale.

These have been uncovered in a Sebi probe, which prima facie, revealed “mis-utilization and diversion of funds of the corporate in a fraudulent method by its promoter administrators, Anmol Singh Jaggi and Puneet Singh Jaggi, who’re additionally the direct beneficiaries of the diverted funds”.

Gensol secured ₹977.75 crore in loans from IREDA and PFC between FY22 and FY24. Of the mortgage, ₹663.89 crore was meant for buying 6,400 EVs. Nevertheless, Gensol admitted to buying solely 4,704 EVs, value ₹567.73 crore, as confirmed by provider Go-Auto.

Provided that Gensol was additionally required to offer 20% fairness contribution, the full outlay ought to have been ₹829.86 crore, leaving an unaccounted-for quantity of ₹262.13 crore.

The Sebi probe discovered that funds meant for EV purchases have been typically routed again to Gensol or entities linked to Jaggi brothers.

A few of the funds have been used for private bills of the promoters, resembling the acquisition of a luxurious condominium, transfers to shut family, and investments benefiting non-public entities owned by the promoters.

In response to those governance lapses, Sebi took a number of stringent measures, together with prohibiting Gensol and its promoters — Jaggi brothers — from accessing the securities market till additional discover.

Additionally, it barred the Jaggi brothers from holding any directorship or key administration place in Gensol.

Moreover, Sebi directed Gensol Engineering to place its deliberate inventory cut up into the ratio of 1:10 on maintain.

Following the order, the brothers stepped down as the corporate’s administrators.