- Rajesh Exports denies SEBI's allegations of Rs 15.15 lakh crore revenue inflation claim
- SEBI's interim order accuses Rajesh Exports of major financial misrepresentation from FY21-FY25
- Company claims a communication gap caused misunderstanding with SEBI and submits more documents
A day after the Securities and Exchange Board of India (SEBI) accused Rajesh Exports of one of the largest alleged financial misrepresentation cases in India's corporate history, the gold refining and jewellery giant has pushed back strongly.
The Bengaluru-headquartered company says its revenues are accurate. It adds there has been no overstatement. And it insists that the regulator's findings are only preliminary.
In a stock exchange filing on Thursday, Rajesh Exports rejected allegations that it inflated revenues running into Rs 15.15 lakh crore. The company said it is in the process of providing additional documents to the regulator and expressed confidence that the matter would eventually be resolved.
"The revenues declared by the company are correct and there is no over stating of revenues," Rajesh Exports said. Follow Markets Live Updates
The statement marks the company's first detailed response after SEBI's explosive interim order sent shockwaves through the market and triggered a fresh selloff in its shares.
Rajesh Exports Under SEBI Lens
The clarification comes at a critical moment. On Wednesday (June 3), SEBI issued a 109-page interim order against Rajesh Exports and its promoter-chairman Rajesh Mehta, alleging large-scale discrepancies in the company's financial reporting between FY21 and FY25.
The regulator claimed that nearly all of the company's reported consolidated revenues during the period could not be adequately verified during its investigation.
According to SEBI, the cumulative mismatch amounted to around Rs 15.15 lakh crore, making it one of the biggest alleged cases of revenue misrepresentation ever examined by the regulator.
The order also barred Mehta from buying, selling or dealing in securities of the company until further directions.
The allegations, as expected, rattled investors. Rajesh Exports shares hit the 5 per cent lower circuit at Rs 104.65 on the BSE on Thursday as markets reacted to the regulator's findings.
'There Is A Communication Gap'
While rejecting the allegations, Rajesh Exports suggested that the dispute may stem from a misunderstanding rather than wrongdoing.
"There seems to be some type of communication gap and confusion between SEBI and the company," the filing said.
The company stated that it is currently submitting all relevant records sought by the regulator and believes the documents will help clear up the concerns raised during the investigation. "The company is in the process of clarifying all aspects to SEBI by submitting all the required and relevant documents," it added.
The company further said it remains confident that the regulator will reach the correct conclusion once it reviews the authenticated records.
The statement mirrors comments made earlier by Chairman and Managing Director Rajesh Mehta, who had also maintained that the revenues reported by the company were genuine.
Why SEBI Took Action
The dispute began after a shareholder complaint was filed in March 2024. The complaint questioned certain financial disclosures, particularly long-pending trade receivables.
Following the complaint, SEBI launched a detailed probe and appointed an investigating authority. The regulator later engaged forensic auditor BDO to examine the company's records.
The investigation focused heavily on revenues reported by overseas subsidiaries, particularly Switzerland-based Valcambi SA, which forms the backbone of Rajesh Exports' global refining business.
SEBI alleged that between 97 per cent and 99 per cent of the company's consolidated revenues originated from overseas subsidiaries. However, according to the regulator, the revenues independently verified from those subsidiaries were substantially lower than the figures disclosed at the group level.
That gap ultimately formed the basis of the regulator's allegations.
SEBI also raised questions about certain transactions, related-party dealings and a reported investment in African gold mining assets.
Interim Order, Not Final Verdict
A key point in Rajesh Exports' defence is that the regulator's order is not the final word on the matter. "The order is interim and there has been no any adverse conclusion on any aspect arrived by SEBI," the company said.
That distinction is important. An interim order allows the regulator to take preventive action while an investigation is ongoing. It does not amount to a final determination of guilt.
Rajesh Exports and Rajesh Mehta will have an opportunity to respond to the findings, submit evidence and present their case before SEBI arrives at a final conclusion.
Legal and regulatory experts note that such proceedings can take months, and sometimes years, before a definitive outcome emerges.
What's At Stake?
The stakes are enormous. If SEBI's allegations are ultimately upheld, Rajesh Exports could face significant penalties, prolonged restrictions in the capital markets and further regulatory action.
But if the company succeeds in explaining the discrepancies and providing the documents sought by investigators, the narrative around one of India's most closely watched corporate investigations could change dramatically.
For now, investors are left navigating two competing versions of the story. The battle is far from over.
