Arun Menon who had joined the board on 19 April 2022, and Kuljit Singh Popli who had joined on 10 June 2024 stepped down this week. Earlier on 13 March, Rajesh Jain left the board.
The directors who quit flagged Gensol’s myriad RPTs and over-leverage in its rush to unrelated businesses like electric vehicle leasing and manufacturing. While the promoters promised to hive off the leasing business once it achieved scale, the promise was never met, three people familiar with the matter said.
“I was told that Deloitte has been appointed, but I later learnt that nothing like that happened,” one of the three people said on the condition of anonymity.
In his resignation letter addressed to Anmol Singh Jaggi on Tuesday, Menon said he had sought clarity regarding the debt position in July-August 2024. Jaggi had proposed to restructure debt to reduce interest burden, Menon claimed. Menon’s letter said he had even proposed to help restructure the debt to reduce interest burden.
Also read | Gensol: The Jaggi brothers made smart moves. So, why did they need a ‘piggybank’?
“While you had messaged me that you would call back, it never progressed,” he wrote in the letter, which was disclosed to the stock exchanges. Menon wrote that he even sought a meeting with the company’s chief financial officer on two or three occasions, but nothing came of it. “There was growing concern on the leveraging of GEL balance sheet to fund the capex of other business’s [sic.]; and the sustainability of servicing such high debt costs by GEL,” he wrote.
According to a second person, the company had a good solar engineering, procurement and construction (EPC) business, and its entry into EV leasing and manufacturing stretched its balance sheet.
“It was not that I did not voice my concern. Multiple times, there were discussions about why Gensol was into EV leasing and manufacturing when the solar EPC business was doing well. The promoters assured us that they would hive off this business, but let’s give it some time to make this business sustainable,” the person said on the condition of anonymity.
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Gensol had borrowed to buy 6,400 cars but actually bought just 4,704. Board members were told that the company was awaiting the delivery of the rest, this person said.
To be sure, all three said the promoters appeared transparent and forthcoming when they joined the board, and had treated their employees well.
“Well, the promoters appeared to be nice people. They had a vision, and the company was doing good. So, I joined. We all make mistakes, don’t we?” the person added.
Who’s in the driver’s seat?
Until last month, Gensol’s board consisted of seven members. With the exit of three directors and the ban on the Jaggis, the board strength is down to two — Vibhuti Patel who joined on 11 July 2023, and Harsh Singh who joined on 19 October 2023–breaching the minimum of three prescribed in the Companies Act, 2013.
Also read | A 68% fall in Gensol stock prompts creditors to seize 7% promoter pledged shares
Anmol Singh Jaggi was Gensol’s managing director until Sebi cracked the whip on Tuesday.
Emails to Anmol Singh Jaggi and the company’s current and former board directors remained unanswered.
“This decision has not been made lightly, and I have given it significant thought,” Jain wrote in his resignation letter last month. “There is much to cater to, in the company. Whilst promoters are well focused on business growth, there may be a need for a mentor/advisor to provide necessary guidance in such a fast growth environment, wrote Jain, who had joined the Gensol board on 8 May last year. Jain was also the chair of the audit committee, with Anmol Singh and Popli as other members.
The director exits at Gensol come less than two months after the developments at AGS Transact Technologies Ltd in February. Within days of the country’s second-largest manager of automated teller machines acknowledging that a cash crunch had forced it to default on bank loans and staff salaries, all four independent directors resigned quickly, citing “personal reasons.”
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According to a Gensol disclosure, the company’s debt totaled ₹1,146 crore at the end of February 2025. The management tried to sell 2997 EVs worth ₹315 crore to Refex Green, but that deal was cancelled last month. Gensol has also outlined plans to sell the US business of solar tracking subsidiary Scorpius Trackers to an unnamed American company for ₹350 crore. The management said the transaction should be completed by the end of March 2026.
However, since Gensol bought Scorpius for ₹140 crore last year, many analysts and investors are sceptical that Gensol could close this transaction.
In April-December 2024, 72.3%, or ₹764 crore, of Gensol’s ₹1,056 crore revenue came from the solar EPC business. The remaining 27.7%, or ₹294 crore, came from EV leasing.
And read | The curious case of Gensol promoters share pledge and cash in current accounts
