Gensol Engineering Hits Lower Circuit Again, Stock Down Over 65% This Year

Gensol Engineering Ltd. hit the lower circuit for the second consecutive day on Tuesday after the promoters infused Rs 28 crore in the firm through the conversion of warrants into equity.

These warrants would subsequently be converted into 4.43 equity shares at a price of Rs 871 per share, according to the exchange filling on Monday.

Gensol Engineering recently witnessed a sale of approximately 2.37% of the company's total equity shares by its promoters, to the tune of 9 lakh shares. The sale aimed at unlocking liquidity and reinforcing the company's financial foundation, as per an exchange filing on Friday. Despite the sale, the promoters continue to hold a controlling 59.70% stake in Gensol.

This comes on the heels of the company's recent challenges, with credit rating agencies ICRA and Care Ratings downgrading Rs 2,050 crore of Gensol's debt — over Rs 1,640 crore in long term and over Rs 400 crore in short term debt facilities — to default status.

The company's stock has faced significant pressure recently. Shares of Gensol Engineering have hit lower circuit for the second consecutive day and in the previous week they were locked in the lower circuit for three sessions.

The stock on Tuesday was locked in the lower circuit of 5% at Rs 290.55 per share. This compares to a 0.20% decline in the NSE Nifty 50 Index.

It has fallen 68.41% in the last 12 months and 65.80% year-to-date. Total traded volume so far in the day stood at 1.9 times its 30-day average. The relative strength index was at 14, indicating it was oversold.