Gensol Engineering: This multibagger stock is down about 31% from its all-time high levels; What should investors do?

Multibagger stock: Gensol Engineering share price has slumped over 31% from its all-time high level of ₹1,377.10 apiece recorded on February 20, 2024. According to trendlyne data, Gensol Engineering share price saw a 61.32% increase in its share price over the past year, lagging behind its sector by 8.7%. Gensol Engineering share price today opened at ₹953.95 apiece on BSE, the stock touched an intraday high of ₹958.45, and an intraday low of ₹938 apiece.

According to Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One, Gensol Engineering share price has underperformed relative to the broader market, as the midcap index trades at new highs while this stock remains near its 200-SMA. Currently, prices are hovering around a key support level of ₹910, and a break below this could lead to further selling pressure in the near term. On the upside, there is significant resistance in the ₹980–1,000 range, and only a move beyond this level could trigger positive momentum for the stock.

The stock's growth over the past three years stands at an impressive 4437.4%. Gensol Engineering's shares made their debut on the BSE SME on October 15, 2019. The offering price band was set in the range from ₹81 to ₹83 per share, and the minimum lot size was 1,600 shares, requiring a minimum investment of ₹132,800 for retail investors. Upon listing, the stock was priced at ₹85.4 per share.

Gensol Engineering is a major participant in the renewable energy industry since it specialises in offering solar power engineering, procurement, and construction (EPC) services as well as electric mobility solutions.

Order Book Update

The company has garnered consistent attention for securing consecutive orders. Recently, the prominent player in the renewable energy industry, specialising in solar EPC as well as electric mobility solutions, has been awarded the Letter of Award (LOA) for the implementation of a 16 MWp turnkey EPC rooftop solar project valued at Rs. 40 Crore in the commercial and industrial (C&I) sector from a leading textile company. Gensol, which has previously worked with the company, will be responsible for the installation in Madhya Pradesh and is expected to complete the project within six months.

Gujarat Urja Vikas Nigam Limited (GUVNL) awarded the business the second tranche in June as part of the greenshoe option allocation of 250 MW/500 MWh for the standalone Battery Energy Storage Systems (BESS) project, increasing the project's total capacity to 500 MW / 1000 MWh. It is anticipated that the project, which consists of the first and second tranches, will generate a total income of ₹2,685 crore throughout the course of the 12-year Battery Energy Storage Purchase Agreement (BESPA).

Revenues for the firm increased to ₹275 crore from ₹147 crore in the same period last year.

Q1 Results

For the quarter ended June 2024, Gensol Engineering reported a more than two-fold increase in its standalone profit after tax (PAT) of ₹32.5 crore, driven by greater revenues.

According to a business exchange filing, during the April–June quarter of the previous fiscal year, 2023–24, it declared a PAT of ₹12.3 crore.

Anmol Singh Jaggi, the company's managing director and chairman, stated that the first quarter of FY25 saw extraordinary performance. In order to increase their total profitability, Gensol is growing its footprint in both existing and emerging market sectors, such as solar, battery energy storage systems (BESS), and electric vehicle leasing. These industries are all expected to see rapid expansion in the near future.

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