Centre Considers Dropping Rajesh Exports from Battery PLI Scheme Amid SEBI Fraud Allegations
Ministry of Heavy Industries to Decide on Rajesh Exports' PLI Status Amid SEBI Probe
The Ministry of Heavy Industries (MHI) is on the verge of making a crucial decision regarding Rajesh Exports' eligibility for the production-linked incentive (PLI) scheme for advanced chemistry cell (ACC) battery storage. This move comes in the wake of a 109-page ex parte interim order issued by the Securities and Exchange Board of India (SEBI) on June 3, alleging large-scale financial irregularities at the company.
According to sources within the ministry, there is a "strong view" that Rajesh Exports should be removed from the scheme. The matter is expected to be placed before Heavy Industries Minister H D Kumaraswamy, who has recently returned from an official visit to Kyrgyzstan. A final decision is expected to be made in the coming days.
SEBI's interim order alleged that Rajesh Exports inflated revenues by Rs 15.15 lakh crore between FY21 and FY25, with approximately 99.8% of the revenues attributed to the company's subsidiaries being materially misrepresented. The regulator also accused the company of fund diversion, opaque related-party transactions, and disclosure failures involving Elest Pvt Ltd and ACC Energy Storage Pvt Ltd, two entities linked to Rajesh Exports' lithium-ion cell business.
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As a result of SEBI's findings, Rajesh Mehta, the promoter and Chairman of Rajesh Exports, has been barred from buying, selling, or dealing in the company's securities until further proceedings are completed. Additionally, the market regulator has ordered a fresh forensic audit of the company's books.
Rajesh Exports has denied SEBI's allegations and stated that they are cooperating with the investigation. The Ministry of Heavy Industries is currently examining SEBI's findings before deciding on the next course of action.
| Scheme | Rajesh Exports' Eligibility Status |
|---|---|
| ACC Battery Storage PLI Scheme | Under Review |
Note: The table above represents the current status of Rajesh Exports' eligibility under the ACC Battery Storage PLI Scheme.
Investor Takeaway
Investors should be cautious of Rajesh Exports' involvement in the PLI scheme due to SEBI's allegations of financial irregularities.
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