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BluSmart, India’s first all-electric ride-hailing aggregator, is contemplating either transitioning part of its fleet to Uber or completely exiting the ride-hailing business, as it stares at an uncertain future, with its co-founders Anmol and Puneet Singh Jaggi, accused of misappropriating funds earmarked for financing electric vehicles for their personal use, including the acquisition of luxury real-estate, forex for personal use worth ₹1.86 crore, and a TaylorMade premium golf set worth ₹26 lakh.
The damning allegations come at a time when BluSmart—which was started in 2019 as a fleet operator, listing its vehicles on Uber, and has an estimated monthly cash burn of about ₹20 crore—struggles maintaining its day-to-day operations. BluSmart differs from traditional ride-hailing platforms like Ola and Uber because it owned both the fleet of electric vehicles, and hired drivers as employees.
However, this asset-heavy model became financially untenable as the company expanded its fleet and its operations to different cities, including Dubai, which has now ceased to exist. The company has also folded its plans to expand operations to Riyadh, and according to The Morning Context, the BluSmart livery on some of its electric vehicles in its Sarjapur hub in Bengaluru are being replaced with Uber’s livery.
According to Sebi's published interim order, Gensol received a loan worth ₹93.88 crore from IREDA. The brothers then used a series of complex transactions to transfer ₹42.94 crore to DLF for buying a luxury apartment at The Camellias in Gurgaon. “The promoters were running a listed public company as if the company’s funds were the promoters’ piggybank,” Sebi said.
“We urge stakeholders not to draw conclusions based on unverified information. BluSmart continues to operate as usual — all our vehicles and driver partners are fully on the road, actively engaged in serving our valued customers across cities,” read a statement from BluSmart, adding that it “will share an official update in due course,” not elaborating what the update would entail. Both BluSmart and Anmol Singh Jaggi have remained tight-lipped about divulging any details.
The Economic Times earlier reported that BluSmart’s shareholders have approved its plan to pivot away from its mainstay business of ride-hailing operations in a phased manner. Initially, 700-800 cabs of the fleet will transition to Uber’s fleet, while the exact timeline of the transition remains unknown. Business Standard, on the other hand, has said that BluSmart is in talks with Uber for a hybrid model where it will list some of its fleet on the Uber platform, while continuing its own operations with a pruned fleet.
Despite raising about ₹1,245 crore in 14 funding rounds, by 2024, the company was struggling to raise fresh funds, leading to its founders—Puneet and Anmol Singh Jaggi—infusing their funds to keep the company afloat, while searching for investors.However, as a debt crisis began to unfold at Gensol Engineering—the publicly-listed company promoted by Anmol Jaggi—where rating agencies, including ICRA, downgraded the company’s ratings to default category—alleging doctoring of documents, delayed debt repayments and its liquidity position—securing sufficient funds for BluSmart became more difficult.
Sebi has also concurred with the ratings agencies, finding falsification in the litany of documents submitted to the ratings agency. Gensol claimed that it serviced its debts on time, whereas it has defaulted on debts. In early February, it was reported that BluSmart defaulted on bonds worth ₹30 crore because of its ongoing cash crunch. According to a Mint report, while the debt was repaid later, but the initial delay caused the trustee of the non-convertible debentures to trigger a “cross-default”, which made BluSmart default on all obligations because it defaulted on one.
What compounded its problems was Gensol’s deal to sell 2,997 of its electric vehicles by Refex Green Mobility—the wholly-owned subsidiary of a Chennai-based refrigerant gas manufacturer—for nearly ₹315 crore, citing “evolving commitments at both ends”. Interestingly, the deal, which was agreed upon in March, would have resulted in the acquired vehicles leased back to Gensol.
Last month, Anmol Jaggi, in an interview to Business Standard, denied media reports claiming that the company is eyeing a sale to Uber, calling it “purely speculative and unfounded”, and counter-claimed that its total debt was at an “all-time” low. However, Gurugram-based BluSmart, according to media reports, is yet to disburse the salaries for March, citing low cash flows. Jaggi had reassured the staff that the salaries will be cleared by the end of April.
Many from the top brass of the company—including CEO Anirudh Arun and its chief business officer Tushar Garg—have put down their papers. Meanwhile, many of its users have taken to social media to complain about the poor upkeep of its cabs, including torn seats, late to no show of its cabs, being charged extra for rides, and even failed payments.
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