SEBI
The Securities and Exchange Board of India (SEBI) has issued a 109-page interim ex-parte order in the matter of Bengaluru-headquartered Rajesh Exports Limited and its promoter and Executive Chairman, Rajesh Jaswanth Rai Mehta, after recording prima facie observations relating to the company’s financial disclosures.
According to SEBI’s interim order dated June 3, 2026, the regulator has prima facie alleged revenue misrepresentation of approximately ₹15.15 lakh crore over the five-year period between Financial Year 2020–21 and Financial Year 2024–25.
The order states that a substantial part of the company’s consolidated revenue during this period was attributed to overseas subsidiaries and step-down subsidiaries, particularly Valcambi SA, but the underlying records required for independent verification were either not furnished or were found inadequate at the interim stage.
SEBI’s order notes that approximately 97% to 99% of Rajesh Exports’ consolidated revenue was dependent on overseas subsidiaries.
The regulator further recorded a prima facie view that about ₹15,15,385 crore, representing nearly 99.80% of revenue attributed to subsidiaries during FY21 to FY25, appeared to have been misrepresented.
The company has disputed these observations. In exchange filings issued after the order, Rajesh Exports stated that the order is interim in nature, that no final adverse conclusion has been reached, and that its declared revenues are correct.
The company also attributed the dispute to what it described as a communication gap or confusion between SEBI and the company.
Pending completion of the investigation, SEBI has directed Rajesh Exports to cooperate with the investigating authority and provide documents and explanations sought by the regulator.
SEBI has also restrained Rajesh Mehta from buying, selling, or dealing in the securities of Rajesh Exports Limited, directly or indirectly, until further orders. The regulator has further directed the appointment of a new forensic auditor to complete the forensic audit of the company’s books of accounts.
The Core of SEBI’s Prima Facie Findings
SEBI: According to the interim order and subsequent public reports, SEBI’s investigation began after a shareholder complaint in 2024 raised concerns about large outstanding trade receivables. The complaint reportedly questioned why substantial receivables remained on the company’s balance sheet for an extended period.
During the investigation, SEBI examined financial records and disclosures from April 2020 onward. The order records several prima facie concerns, including non-furnishing of complete subsidiary-level records, discrepancies in customer-wise data, alleged accounting mismatches, and questions over transactions recorded in the company’s books.
1. Valcambi SA and the Overseas Revenue Issue
SEBI: Rajesh Exports had disclosed large consolidated revenues, a major portion of which was attributed to its overseas structure, including Switzerland-based Valcambi SA. Rajesh Exports acquired Valcambi SA in 2015 for approximately $400 million.
SEBI’s interim order records that while Valcambi SA was presented as a key operating entity, its audited standalone financial statements reflected much lower standalone revenue figures than the revenue attributed to the overseas subsidiaries in Rajesh Exports’ consolidated accounts.
SEBI compared the revenue attributed to subsidiaries and step-down subsidiaries with the audited standalone revenue of Valcambi SA and recorded a prima facie mismatch.
According to SEBI’s table in the interim order, Rajesh Exports reported consolidated revenue of approximately ₹15.44 lakh crore during FY21 to FY25.
Out of this, revenue attributed to subsidiaries and step-down subsidiaries was approximately ₹15.18 lakh crore. SEBI recorded that Valcambi SA’s revenue, converted into Indian rupees, was approximately ₹3,027 crore for the relevant period.
On that basis, SEBI recorded a prima facie misrepresentation figure of approximately ₹15.15 lakh crore.
Rajesh Exports has contested this approach. Rajesh Mehta has reportedly stated that Valcambi refined about 3,000 tonnes of gold during FY21 to FY25 and that, in the company’s view, such refining activity would naturally involve very large revenue figures.
The company’s position is that SEBI’s observations arise from a misunderstanding of consolidated revenue and the accounting treatment of Valcambi’s business.
2. Affluence Shares and Stocks Transaction Entries
SEBI: SEBI’s interim order also discusses transactions recorded in the books of Rajesh Exports in relation to Affluence Shares and Stocks Private Limited, an Ahmedabad-based brokerage firm.
According to the order, officials of Affluence, including its promoter Dhiren Shah, stated before SEBI that Affluence had trading relations with Rajesh Mehta in his personal capacity and had not undertaken transactions with Rajesh Exports Limited as a corporate entity.
SEBI recorded a prima facie view that trades executed through the personal account of Rajesh Mehta appeared to have been recorded as Rajesh Exports’ sale and purchase transactions in the company’s books during FY22 to FY24.
The regulator stated that this prima facie resulted in inflation of standalone sales and purchase figures.
For legal clarity, this remains SEBI’s prima facie observation at the interim stage.
Rajesh Exports and Rajesh Mehta retain the right to submit explanations, documents, and objections before the regulator and other appropriate forums.
3. Accounting Treatment of Income and Transactions
The SEBI order also raises prima facie concerns over the way certain transactions and income items were treated in the company’s books.
The regulator questioned whether certain profits, losses, or entries linked to foreign exchange movements, treasury activity, fixed deposits, mutual funds, or other financial transactions were presented in a manner that affected revenue from operations or purchase figures.
The legally relevant point is not that final wrongdoing has been established, but that SEBI has found sufficient prima facie grounds to continue investigation into whether the company’s reported operational scale and financial position were presented accurately to investors.
4. Overseas Mining Investment Disclosures
The interim order also refers to disclosures relating to investments in gold mines in Africa.
SEBI recorded that Rajesh Exports had disclosed substantial overseas investments linked to gold mines. According to the regulator, the company did not provide adequate independent valuation reports, proof of investment, or ownership documentation to substantiate these assets during the investigation.
Rajesh Exports has maintained that the relevant investments exist through foreign subsidiaries and that the figures are correct. This issue therefore remains part of the ongoing regulatory examination.
Corporate Disclosures and Counter-Position After SEBI’s Order
After SEBI’s interim order, Rajesh Exports issued exchange filings and press releases responding to the allegations and media reports.
1. Rajesh Exports’ Official Position
In its filings to the stock exchanges, Rajesh Exports stated that SEBI’s order is interim and that no final adverse conclusion has been reached.
The company said its revenues are correct and that there is no overstatement of revenue.
The company also stated that there appears to be a communication gap or confusion between SEBI and the company.
In a later clarification, Rajesh Exports said it is in the process of addressing the concerns raised in the interim order with explanations, documents, and evidence.
The company also asserted that it is debt-free and that the dispute concerns interpretation and verification of revenue entries rather than a proven diversion of borrowed funds.
2. Company’s Revenue Defence
Rajesh Exports has argued that artificially inflating revenue without corresponding profit would not provide a logical commercial benefit, because higher revenue without sufficient profit margin could adversely affect financial ratios.
The company’s defence is that SEBI has misunderstood the accounting and documentation relating to Valcambi and other overseas subsidiaries. Public reports also state that Rajesh Mehta has indicated that the company will resubmit documents to SEBI to clarify the matter.
3. NFRA Reference
SEBI’s interim order states that, considering the prima facie observations regarding the role of statutory auditors, a copy of the order shall be forwarded to the National Financial Reporting Authority for appropriate action, if any, against the statutory auditors of Rajesh Exports Limited.
This does not amount to a final finding against the auditors. It means that the audit-related aspects may be independently examined by the appropriate accounting and audit regulator.
4. Possible Impact on PLI Scheme
Separate media reports have stated that the Ministry of Heavy Industries may consider removing Rajesh Exports from the beneficiary list of the Production Linked Incentive scheme for Advanced Chemistry Cell battery storage.
As of the available reports, this appears to be a possible government action under consideration and not a final removal order. Any such decision would depend on the ministry’s review and applicable scheme conditions.
Rajesh Mehta and the Growth of Rajesh Exports
Rajesh Mehta has long been associated with the rise of Rajesh Exports as a major Indian gold and jewellery company.
Historical corporate profiles have described how Rajesh and his brother Prashant Mehta started Rajesh Diamonds in Bengaluru in the late 1980s and gradually expanded into gold jewellery manufacturing, exports, refining, and retail.
Rajesh Exports went public in 1995 and later expanded its operations across domestic and international markets.
In 2015, the company acquired Switzerland-based Valcambi SA, one of the world’s prominent gold refiners, in a reported $400 million all-cash transaction.
The company also developed its retail presence through Shubh Jewellers in Karnataka. Its share price had touched a high of ₹946.85 in February 2023 before later declining sharply.
LIC Exposure and Market Reaction
The interim order has also drawn attention to institutional shareholding in Rajesh Exports, especially the exposure of Life Insurance Corporation of India.
Public shareholding data cited in market reports indicates that LIC held a significant equity stake in the company as of March 2026.
Commentators have questioned why institutional exposure remained despite earlier concerns expressed in the market about the company’s low margins, high revenue figures, and limited profitability.
Market reports noted that Rajesh Exports’ share price declined after SEBI’s interim order.
The stock has also seen a sharp correction from its 2023 peak. However, share price movement should be understood as market reaction to regulatory developments and investor sentiment, not as proof of final wrongdoing.
Legal and Regulatory Disclaimer
The facts, figures, and allegations referred to in this news article are based on SEBI’s interim ex-parte order dated June 3, 2026, official exchange filings by Rajesh Exports Limited, and subsequent public reports.
SEBI’s observations are prima facie and interim in nature. They do not amount to a final judicial conviction, final adjudication, or conclusive finding of fraud.
Rajesh Exports Limited, Rajesh Mehta, associated promoters, directors, auditors, and other concerned parties retain their full legal rights to submit replies, produce documents, contest the findings, seek hearings, approach the Securities Appellate Tribunal, or pursue other remedies available under law.
This article should therefore be read as a report on regulatory allegations, company responses, and pending proceedings, not as a final determination of civil or criminal liability.
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