SEBI Accuses Rajesh Exports of ₹15 Lakh Crore Revenue Inflation
India's market regulator, SEBI, has accused Rajesh Exports Ltd. and its chairman of allegedly inflating consolidated revenues by over ₹15 lakh crore between FY2020-21 and FY2024-25. The company denies the allegations, attributing discrepancies to a misunderstanding of its Swiss subsidiary's financials, and has vowed full cooperation with the ongoing investigation.
Key Highlights
- SEBI alleges ₹15.15 lakh crore revenue inflation by Rajesh Exports over five years.
- Allegations primarily involve foreign subsidiaries, especially Swiss refiner Valcambi SA.
- SEBI has barred Rajesh Mehta, promoter, from accessing the securities market.
- Rajesh Exports denies wrongdoing, citing 'confusion' over Valcambi's financials.
- Investigation initiated after shareholder complaint regarding outstanding trade receivables.
- SEBI ordered a fresh forensic audit and seeks full cooperation from the company.
The Securities and Exchange Board of India (SEBI), India's capital market regulator, has leveled serious allegations against Bengaluru-based gold refiner and jewellery major Rajesh Exports Limited (REL) and its Executive Chairman, Rajesh Mehta. An interim ex-parte order issued by SEBI on June 3, 2026, claims that Rajesh Exports misrepresented its consolidated revenues, projecting an inflated cumulative revenue of approximately ₹15.44 lakh crore (or ₹15.15 lakh crore, as reported by some sources) over a five-year period from fiscal year 2020-21 to 2024-25.
The allegations, which have sent ripples through the Indian stock market and raised significant corporate governance concerns, stem from an investigation initiated following a shareholder complaint in March 2024. The complaint highlighted large trade receivables that had remained outstanding for more than two years, prompting SEBI to launch a deeper review of the company's accounts and disclosures. In October 2024, SEBI appointed an investigating authority and later engaged forensic auditor BDO India Services Private Limited to examine the company's books and transactions.
According to SEBI's preliminary findings, between 97% to 99% of Rajesh Exports' consolidated revenues during the review period were attributed to its overseas subsidiaries and step-down subsidiaries, with Switzerland-based Valcambi SA identified as the principal revenue-generating entity. However, the regulator found a significant divergence between the revenues reported by Valcambi and the sales figures disclosed in the group's consolidated financial statements. SEBI's order also cited challenges during the forensic review, including the alleged non-submission of key customer and vendor records, and the absence of financial statements for certain subsidiaries. It further noted that the audit process was complicated by incomplete documentation, inconsistencies in provided information, and limited cooperation during parts of the investigation. The regulator alleged that some sales and purchase transactions were potentially questionable, and funds were allegedly moved through accounts linked to promoter-related entities, with personal gold trades potentially being passed off as corporate sales.
In response to the interim order, SEBI has restrained Rajesh Mehta from buying, selling, or dealing in the securities of Rajesh Exports or accessing the securities market until further orders. Furthermore, a fresh forensic audit has been ordered, and the company has been directed to cooperate fully with the investigating authority and submit all requisite documents and explanations within 30 days.
Rajesh Exports, a global leader in the gold business with operations spread across the world and headquarters in Bangalore, India, has strongly denied the allegations. In an exchange filing and press statements, the company maintained that its reported revenues were accurate and genuine. It attributed the alleged discrepancy to SEBI's 'confusion' between revenue and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) figures for its Swiss subsidiary, Valcambi SA. Rajesh Mehta has stated that the company will not challenge SEBI's interim order and is in the process of submitting documents and evidence to address each concern raised, expressing confidence that the regulator will clear all suspicions after reviewing the submissions.
This incident has had an immediate impact on Rajesh Exports' share price, which reportedly hit a 5% lower circuit following the news of SEBI's interim order. The market capitalization of the company is just over ₹2,900 crore. The case is particularly significant given Rajesh Exports' stature as one of India's largest gold companies by revenue, processing a substantial percentage of the world's gold. The controversy also highlights SEBI's crucial role in enforcing corporate governance, ensuring transparency, and protecting investor interests in the Indian securities market. The matter remains under investigation, and the interim order represents SEBI's preliminary findings, not a final determination of wrongdoing.
Frequently Asked Questions
What are the main allegations made by SEBI against Rajesh Exports?
SEBI alleges that Rajesh Exports and its chairman inflated consolidated revenues by approximately ₹15.15 to ₹15.44 lakh crore over five fiscal years, from FY2020-21 to FY2024-25. The allegations primarily concern transactions through overseas subsidiaries, particularly Valcambi SA, and issues related to lack of documentation, cooperation, and potential diversion of funds through personal trades.
How has Rajesh Exports responded to these allegations?
Rajesh Exports has vehemently denied the allegations, stating that its reported revenues are accurate and genuine. The company claims that SEBI's interim order stems from a misunderstanding or 'confusion' between revenue and EBITDA figures related to its Swiss subsidiary, Valcambi SA. Rajesh Exports has pledged full cooperation with the investigation and is in the process of submitting necessary documents.
What actions has SEBI taken as a result of its interim order?
As an interim measure, SEBI has barred Rajesh Mehta, the promoter and Executive Chairman of Rajesh Exports, from buying, selling, or dealing in the company's securities or accessing the securities market. The regulator has also ordered a fresh forensic audit of the company's financials and instructed Rajesh Exports to provide all requested documents and explanations within 30 days.
What is the role of Valcambi SA in this controversy?
Valcambi SA, a Swiss gold refiner acquired by Rajesh Exports, is central to the allegations. SEBI's findings indicate that Valcambi and other overseas subsidiaries accounted for 97-99% of Rajesh Exports' consolidated revenues during the period in question. SEBI found significant discrepancies between Valcambi's reported revenues and the consolidated sales figures, which Rajesh Exports attributes to SEBI misinterpreting financial reporting standards for Valcambi.
What is the significance of this case for the Indian market and corporate governance?
This case is highly significant as it involves one of India's largest gold companies and allegations of a massive financial misrepresentation. It underscores SEBI's crucial role in maintaining transparency, protecting investor interests, and enforcing corporate governance standards in the Indian securities market. The outcome of this investigation could have far-reaching implications for corporate accountability and regulatory oversight in India.
