The Indian stock market registered dismal performance in the calendar year 2022 amid a brutal selloff by foreign investors, the Russia-Ukraine war, a sharp rise in commodity prices, and policy tightening by central banks globally. Even now, while the underlying fundamentals for the domestic market remain fragile amid looming recession fear, some stocks have defied conventional logic and delivered mammoth returns to their investors.

Gensol Engineering, a consulting services company, is one such stock that has continued its upward trajectory so far this year after witnessing consolidation in the last couple of years. In the calendar year 2022, Gensol Engineering has given 534% returns, with shares surging from ₹119.15 on January 3, to fresh all-time high of ₹752.30 on July 19. In contrast, the BSE benchmark Sensex has tumbled 7.5% this year.

The share price of Gensol Engineering, which provides technical advisory and engineering services for solar power projects, currently trades 1,380% higher than its 52-week low of ₹50.78 touched on August 18, 2021.

On Tuesday, the stock opened higher for the sixth straight session, hitting 5% upper circuit for a third trading day. The stock belled the day in positive terrain at ₹734.90 against the previous closing price of ₹716.50, and rose 5% to close at a new record high of ₹752.30 on the BSE. With a market capitalisation of ₹822.78 crore, the microcap stock has gained more than 19% in the last six sessions and 74% in a month. In the last one year, the stock has zoomed nearly 1,300% and 480% in the past six months.

It is difficult to find specific reasons behind this skyrocketing rally that Gensol Engineering has witnessed in the last one year. Given the recent demand for renewable stocks, it can be ascertained that investors are betting high on green energy related stock amid government’s thrust on renewable energy sources, indicating brighter prospects for the company going ahead.

Recently, Gensol Engineering, a part of Gensol group of companies that offers EPC and solar advisory services, signed a deal to acquire a majority stake in a US-based electric vehicle manufacturing startup. The acquisition will allow Gensol to have an in-house manufacturing facility for capturing the highly explosive growth of the electric vehicle (EV) market, keeping in mind that the case for immediate electrification of consumer transport is undeniable.

As per the company, the investment is intended to accelerate Gensol’s plan to deliver a robust domestically manufactured EV in India, which will help its revenue to grow by ₹500-₹600 crore for FY24.

“Gensol aims to set up its R&D center for technology development and a start of production (SOP) in the first quarter of 2023 in Pune, India with a capacity of 12,000 cars/year in the first phase. The company is also hiring a team of more than 150 automobile engineers & designers for this venture,” it said in a release on July 5.

Earlier in March this year, the company has secured a loan of ₹267.79 crore for expanding its new business vertical of electric vehicles. As of February 2022, its fleet consists of 284 electric cars that are flying in the Delhi NCR region.

Incorporated in 2012, Gensol Engineering is engaged in providing technical due diligence, detailed engineering, quality control, construction supervision, and other consulting services for solar projects across many countries, including India. The company has erected solar power plants of over 350 MW capacity on ground and rooftops so far. With international reach, it provides consulting services to Kenya, Ukraine, Oman, Gabon, Sierra Leone, Nepal, Afghanistan, Indonesia, Philippines and Chad.

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