The share price of Gensol Engineering has been on a downward spiral, leaving investors worried. Over the past week, shares have nosedived nearly 40%, with the pressure mounting after credit rating downgrades and promoter stake sales. In today’s trading session, the share price of the company hit a low of Rs 308 on the NSE, falling over 4% in the early hours. The promoters of Gensol are also the founders of electric can aggregator, BluSmart.
Let’s take a look at the key reasons why the share price of Gensol Engineering is on a downward trend.
Credit rating downgrades
Brokerage firms such as ICRA and CARE Ratings recently downgraded Gensol Engineering’s credit rating, citing a liquidity mismatch and delays in loan repayments. For now, the rating cut has dented investor confidence.
The troubles began when ICRA downgraded Gensol’s rating from BBB- (Stable) to D (Default), citing concerns over the company’s ability to service its debt.
Another concerning factor highlighted by ICRA is the increasing percentage of pledged promoter shares, which jumped from 79.8% in September 2024 to 85.5% in February 2025. Moreover, ICRA pointed out issues with BluSmart, an EV ride-hailing company linked to Gensol, which has reportedly delayed payments on its Non-Convertible Debentures (NCDs).
Just a day after ICRA’s downgrade, CARE Ratings also took a grim view of Gensol’s financials. On March 4, CARE Ratings downgraded the company’s long-term bank facilities worth Rs 639.7 crore to CARE D (Default) from the earlier BB+ (Stable). The downgrade wasn’t limited to long-term facilities – other short-term and long-term bank facilities also saw their ratings slashed, reflecting heightened risk.
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One of the key reasons behind the latest slump is the sale of 9 lakh shares (about 2.37% of total equity) by the promoters.
“The promoters have sold approximately 2.37% of total equity shares of the company, amounting to 9,00,000 shares, to unlock liquidity that will be reinvested into the business through equity infusion. This step is part of a strategy aimed at reinforcing the company’s balance sheet and supporting stability,” said the company in an exchange filing on March 7.
According to the company, this move is aimed at unlocking liquidity and reinvesting the proceeds into the business.
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