Share price of Gensol Engineering rises 2% on ₹350 crore deal to sell U.S. subsidiary Scorpius Trackers

Market Performance

Gensol Engineering, a key player in the renewable energy sector specializing in solar power engineering, procurement, and construction (EPC) services, experienced a 2% rise in its share price from the intraday low, reaching ₹579.45 per share. The increase followed an official announcement regarding a significant business transaction.

Transaction Details

The company disclosed signing a non-binding term sheet for a strategic transaction worth ₹350 crore. This deal involves selling its U.S.-based subsidiary, Scorpius Trackers Inc., to a significant renewable energy solutions provider in the United States. Exclusive global intellectual property (IP) rights related to Scorpius Trackers' advanced solar tracking technology will be transferred as part of the transaction, except for India.

The transaction is planned to be executed in two tranches, with complete closure anticipated by March 2026. It remains subject to due diligence, customary/statutory approvals, and standard closing conditions.

Financial Strategy and Growth Plans

The capital raised from this transaction is intended to support expansion efforts in India. The company aims to contribute the proceeds to strengthen its solar EPC business and enhance clean energy initiatives. This move aligns with the broader strategy of monetizing high-value assets and reinvesting in core operational areas to ensure long-term financial stability.

Recent Developments

Gensol Engineering has been actively securing significant projects in the renewable energy sector. Notable recent orders include:

• 275 MW Solar PV Project: On January 5, the company secured an EPC contract from a public sector undertaking to develop a 275 MW solar photovoltaic (PV) project at RE Solar Park, Khavda Rann of Kutch, Gujarat. The total value of this contract stands at ₹1,061.97 crore.
• 225 MW-AC Solar PV Project: In December, the company obtained an EPC contract from NTPC Renewable Energy (NTPC REL) to develop a 225 MW-AC (equivalent to 276 MW-DC) grid-connected solar PV project at GSECL Solar Park (Stage-III) in Khavda, Gujarat. The overall bid amount for this project, which includes three years of operation and maintenance (O&M) services, is estimated to be around ₹897.47 crore.
• Bio-Hydrogen Project: Gensol emerged as the lowest bidder for developing India's first bio-hydrogen project in September in collaboration with Matrix Gas & Renewables.

Summary

Gensol Engineering's decision to divest its U.S. subsidiary marks a significant financial and strategic move. The ₹350 crore transaction is expected to unlock capital, enhance operational efficiency, and support future growth in India's renewable energy sector. Additionally, the company's recent project wins underscore its commitment to expanding its clean energy footprint through large-scale solar and hydrogen initiatives. Completing this deal and ongoing projects will be crucial in shaping the company's future trajectory in the renewable energy industry.