Gensol Engineering Share Price Declines 40% In Three Days After Rating Downgrade

Gensol Engineering Ltd.'s share price has plummeted by 40% over the past three days, following a rating downgrade from CARE Ratings.

On Thursday, the stock fell another 10%, adding to the 10% decline on Wednesday and the 20% drop on Tuesday. The stock hit its lower circuit limit after CARE Ratings downgraded Gensol Engineering’s long-term bank facilities to CARE D from CARE BB+; Stable, and its short-term bank facilities to CARE A4+. The downgrade was primarily due to delays in servicing term loan obligations, as reported by the company’s lenders.

Gensol Engineering, the flagship company of the Gensol Group, has a decade-long track record in the renewable power sector. The company provides engineering, procurement, and construction and operations and maintenance services for solar power projects. Additionally, it generates revenue from its electric vehicle leasing business.

The company’s recent quarterly earnings report revealed a decline in both its bottom line and operational performance. Gensol Engineering reported a 6.1% drop in net profit for Q3, with earnings of Rs 16.9 crore, down from Rs 18 crore in the same period last year.

The rating downgrade and subsequent share price decline reflect investor concerns over the company’s financial health and its ability to meet debt obligations.

The scrip fell as much as 10% to Rs 334.80 apiece as of 09:54 a.m., compared to a 0.13% decline in the NSE Nifty 50.

It has fallen 66.78 % in the last 12 months. Total traded volume so far in the day stood at 1.9 times its 30-day average. The relative strength index was at 16.12.