Shares of Gensol Engineering Ltd plunged 20% on Monday, hitting the lower circuit at ₹413.30 after Care Ratings downgraded the company’s credit rating to ‘D’ (default). The downgrade was attributed to ongoing delays in servicing term loan obligations, as per feedback from the company’s lenders.
The stock saw a sharp sell-off after Care Ratings revised its rating from ‘BB+; Stable’ to ‘D’, citing financial stress and liquidity concerns. Gensol’s long-term bank facilities of ₹639.70 crore and short-term/long-term bank facilities of ₹76.30 crore were both downgraded to ‘CARE D’. The agency stated that the downgrade aligns with its policy on default recognition.
Care Ratings highlighted that Gensol Engineering has been struggling with debt servicing, with pending overdue amounts and Special Mention Account (SMA) classification from lenders. Liquidity constraints remain a major challenge, with the company failing to meet timely debt obligations.
The report also indicated that an improvement in the company’s rating would require a consistent track record of at least three months of timely debt servicing.
Gensol Engineering, the flagship company of Gensol Group, has a presence in renewable energy and electric vehicle leasing. Incorporated in 2012, the company provides EPC and operations & maintenance (O&M) services for solar power projects. It was listed on the BSE SME platform in 2019 before moving to the NSE and main BSE platform in 2023.
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