Wave of Resignations! After BluSmart, Gensol's Arun Menon Quits Over Ongoing Debt Crisis

With the BluSmart-Gensol Engineering crisis getting worse each day, the companies’ directors and top officials have been resigning from their positions. After BluSmart Mobility leadership exit, Gensol’s independent director Arun Menon has also put down his papers with immediate effect over “debt position of the company”.

“There was growing concerns on the leveraging of GEL balance sheet to fund the capex of other businesses; and the sustainability of servicing such high debt costs by GEL,” Menon’s resignation letter read, as quoted by media reports.

This came after the Securities and Exchange Board of India (Sebi) decided to ban Gensol promoters --- Anmol Singh Jaggi and Puneet Singh Jaggi --- from acting as director in any listed company. In addition, the market regulator also barred Gensol and other related entities from the Indian stock market until further notice.

Sebi has conducted a detailed probe into Gensol following the reported financial crisis and other issues in the solar energy company amid stock price manipulation complaints and debt defaults. The Jaggi brothers are also cofounders of electric ride-hailing start-up BluSmart.

Founded in 2012, Gensol has established itself as a key player in the solar engineering, procurement, and construction (EPC) sector. In recent years, the listed company has expanded into the electric mobility space, procuring electric vehicles and leasing them to its cab-hailing venture, BluSmart.

Gensol's Debt Crisis

The recent sell off in Gensol shares, which slashed its market capitalization to Rs 855 crore ($99.4 million), was triggered after rating agencies like CARE Ratings and ICRA downgraded the company’s borrowings to default as lenders flagged issues in debt repayments. ICRA even alleged that the company falsified its financial statements, a claim that Gensol denied.

The downgrade raised concerns about the company’s financials, also putting in spotlight a deal to sell its electric vehicle fleet to Refex Green Mobility, a transport solutions company. The deal involved Refex buying Gensol’s 2,997 electric cars and taking over the EPC firm’s Rs 315 crore loan.

Gensol’s liquidity crunch—triggered by credit downgrades, debt concerns, and allegations of financial misreporting—has investors worried about BluSmart’s future. Once an asset, Gensol has become a liability, raising governance red flags and threatening BluSmart’s ambitions, including its rumored IPO.

With questions mounting over financial transparency and sustainability, the fate of one of India’s most promising EV startups is now tangled with Gensol’s precarious balance sheet.