Rajesh Exports Share Price Under Scrutiny Following SEBI's ₹15 Lakh Crore Accounting Misstatement Disclosure

Rajesh Exports Share Price in Focus amid Sebi Allegations

The Securities and Exchange Board of India (Sebi) has alleged that jewellery maker Rajesh Exports misrepresented almost its entire revenue over a five-year period, raising doubts on the reliability of the company's financial disclosures. The stock ended the previous trading session over 3% up to close at ₹110 apiece on the National Stock Exchange (NSE).

Sebi's Allegations Against Rajesh Exports

Sebi has accused Rajesh Exports of misrepresenting nearly all of its revenue over a five-year period, from FY21 to FY25. The regulator alleged that around ₹15.15 lakh crore, representing 99.8% of the revenue attributed to the company's subsidiaries during this period, was inaccurately reported. The investigation was initiated following a shareholder complaint filed in March 2024, which raised concerns about possible financial misstatements linked to substantial outstanding trade receivables.

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Key Findings and Discrepancies

A key focus of Sebi's findings is the group's overseas corporate structure, particularly Switzerland-based Valcambi SA, which Rajesh Exports had identified as its primary operating entity. However, Sebi noted a significant discrepancy between the group's consolidated revenue figures and the standalone audited financial statements of Valcambi SA. According to the regulator, Valcambi's standalone revenue represented less than 0.5% of the consolidated revenue reported by Rajesh Exports and its holding subsidiary, Global Gold Refineries AG (GGR), despite being portrayed as the group's principal business operation.

Regulator's Response and Next Steps

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The regulator further alleged that Rajesh Exports repeatedly failed to provide detailed information regarding its consolidated operations, including party-wise data on sales, purchases, debtors, creditors, and inventory. The company argued that Swiss data protection regulations and confidentiality obligations prevented such disclosures. Sebi dismissed this explanation, stating that the cited provisions relate to personal data protection and do not supersede disclosure requirements mandated under Indian securities laws.

Action Against Rajesh Mehta

REL and Rajesh Mehta have been instructed to fully cooperate with the investigation. Additionally, Mehta has been prohibited from trading in shares of Rajesh Exports until further notice.