Gensol-BluSmart Controversy Explained
Image Source: Wikimedia commons
In mid-April 2025, India’s market regulator SEBI stepped in against Gensol Engineering Ltd., barring its founders from top roles and halting a planned stock split over alleged ₹9.78 billion loan defaults tied to vehicle purchases for BluSmart. Almost simultaneously, electric taxi operator BluSmart suspended its services amid a probe into fund misuse, affecting thousands of drivers and raising refund worries.
With Gensol’s share price plummeting roughly 75 percent since downgrades and BluSmart planning to pivot into a fleet partner for Uber amid a ₹20 crore monthly cash burn, both firms face an uncertain path forward.
SEBI Crackdown on Gensol
SEBI’s interim order, issued on April 15, 2025, bars Anmol Singh Jaggi and Puneet Singh Jaggi from holding any key positions at Gensol or participating in securities markets until further notice.
The regulator flagged defaults on loans totalling ₹9.78 billion borrowed from IREDA and PFC, funds largely routed to buy electric vehicles leased to BluSmart.
Credit rating agencies had already downgraded Gensol over concerns about its liquidity and governance, contributing to a roughly 75 per cent drop in its stock price this year.
SEBI also cancelled a proposed 1:10 stock split, criticising the founders for treating a listed company like a “promoters’ piggy bank”.
Governance and Market Reaction
Investors reacted sharply: Gensol’s share price has fallen by nearly three-quarters, and the promoters trimmed their stake by about 2.4 per cent since the downgrades.
Analysts say the order exposes broader governance risks in clean‑energy firms, where rapid expansion sometimes outpaces financial controls.
BluSmart’s Suspension and Pivot
On April 17, 2025, BluSmart abruptly suspended its electric taxi services after SEBI’s allegations resurfaced against co‑founder Anmol Jaggi for misappropriating funds meant for fleet expansion.
The halt left over 8,000 EV taxis grounded and thousands of drivers without work, sparking customer concerns over refunds from their BluSmart wallets.
BluSmart once claimed around a 9 per cent share of Delhi’s EV taxi market and had built urban charging hubs to support its fleet.
From Ride‑Hailing to Fleet Partner
Facing a steep cash burn—reportedly over ₹20 crore each month—BluSmart’s shareholders have approved a plan to transition its vehicles to Uber’s platform, effectively becoming a fleet partner rather than running its app-based service.
This strategy mirrors BluSmart’s origins, as it first operated EVs on Uber in 2019. Offloading customer‑acquisition and platform costs could help stabilise BluSmart’s finances.
Outlook for Investors
The twin upheavals at Gensol and BluSmart underscore the challenges of scaling capital‑intensive clean‑energy and mobility ventures in India. While Gensol secures large solar EPC contracts and BluSmart’s fleet pivot may shore up cash flows, both companies must rebuild trust with investors, regulators, and drivers. Market participants will now watch closely how SEBI’s forensic probe unfolds and whether BluSmart’s new model can restore stability.
Team Profile
- News Writer
- Saksham Mehta is a journalism graduate from Delhi University and a PGD student in Digital Media at IIMC New Delhi. Passionate about storytelling and news, he is a published author with Zee business. With a keen interest in analytical reporting, digital media, and financial journalism. Saksham is dedicated to making an impact in the evolving world of news and storytelling.
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