Gensol Engineering shares has been in focus after CARE Ratings downgraded its rating citing delay in debt servicing. Post CARE’s downgrade, ICRA too downgraded its credit rating on the stock, alleging that the company had falsified some loan repayment documents.
Speaking to CNBC-TV18 recently, Gensol Engineering’s Chairman and MD Anmol Singh Jaggi denied any wrongdoings on the falsification of documents, adding that the debt servicing delays were due to a liquidity mismatch while executing large projects.At present, Gensol Engineering has an order book of over ₹7,000 crore, which it plans on executing over the next 18 months.
Futher, the CMD said that he is committed to fully servicing the debt and hopes for an upgrade from the rating agencies when they review their stance after three months. Current debt obligations for Gensol stand at ₹20 crore a month, meaning a ₹60 crore repayment need over the next three months.
Jaggi added that that two asset sales, sale of vehicles and a subsidiary are currently underway and that could fetch them a sum of ₹650 crore.The promoters recently sold 2.3% stake, or 9,00,000 equity shares of the company. However, Gensol Engineering said its promoters have infused ₹29 crore through the conversion of warrants into equity. The company said that the warrants would be converted into 4,43,934 equity shares at a price of ₹871 per share.
This 15-day drop has now seen the stock fall below all of its key moving averages.
In terms of technicals, the relative strength index (RSI) of Gensol Engineering stood at 12.3, signaling it’s trading in the oversold territory. This implies that stock may rebound.
The counter has a one-year beta of 0.8, implying very low volatility during the same period.
Gensol Engineering shares are trading lower than the 5 day, 20 day, 50 day, 100 day, 150 day and 200 day moving averages.
Shares of Gensol Engineering are locked in a 5% lower circuit at ₹236.70.
