SEBI: Rajesh Exports misreported $158bn; chairman barred

The Securities and Exchange Board of India issued an interim order on June 3 finding that Rajesh Exports Limited (REL) prima facie misrepresented approximately INR 15,15,385 crore ($158 billion) of revenue, equal to 99.8% of revenues the company attributed to subsidiaries for the five financial years from FY2020-21 to FY2024-25. The regulator barred promoter and chairman Rajesh Mehta from the securities market and ordered a fresh forensic audit.

SEBI’s order says auditors could not reconcile the group’s consolidated revenues with records from overseas units, particularly Swiss refiner Valcambi. The interim order, signed by whole-time member Kamlesh Chandra Varshney, stated: “REL has prima facie misrepresented approximately INR 15,15,385 crore [$158 billion] i.e. representing 99.80% of its revenues which are attributed to subsidiaries during the period FY 2020-21 to FY 2024-25.”

The regulator’s probe began after a shareholder complaint in March 2024 raised concerns about unusually large trade receivables. SEBI says repeated requests for ownership documents, transaction-level evidence and reconciliation statements were not met. The order alleges the company recorded the full gross value of refined gold as its own revenue even though much of that metal belonged to customers and was processed for a fee. Audited accounts for Valcambi reportedly show amounts that are a small fraction of the consolidated totals reported by REL.

The interim order highlights roughly INR 11,487 crore in transactions attributed to broker Affluence Shares and Stocks; the broker informed SEBI that Rajesh Exports was never a client and that no such trades occurred. The regulator also alleges funds were moved from the company to Mehta’s personal account and used for derivative trading without board approval. Rajesh Exports declined to provide some subsidiary records, citing Swiss privacy law, a defense the regulator rejected.

In an exchange filing, Rajesh Exports described the order as interim and said no final conclusion has been reached. The filing argued that revenue reporting follows accounting standards and that the apparent gap results from comparing the gross value of refined gold with processing income. The company stated: “The revenues declared by the company are correct and there is no over stating of revenues. There seems to be some type of communication gap and confusion between SEBI and the company…The company rejects all adverse media reports appearing with regard to the interim order of SEBI. The company will be shortly issuing a media clarification which would clarify and settle the unnecessary speculation in the media.”

Markets reacted after the order. Rajesh Exports shares hit the lower circuit near INR 104 on June 4. The Life Insurance Corporation of India holds about 10.8% of the company, and roughly 194,000 retail shareholders are exposed to the stock’s movements.

SEBI’s directions are interim and ex-parte. The company has 30 days to respond in detail before the forensic audit is carried out. The order notes that reconciling the reported gross value of refined gold with fees or processing income and providing access to underlying records from overseas units will be key elements of the forensic review.