Rajesh Exports on Thursday pushed back against allegations made by the Securities and Exchange Board of India (Sebi), with its promoter and executive chairman, Rajesh Mehta, claiming that the company has already shared more than 400 GB of data and information with the market regulator and attributing the dispute to a “communication gap” and “confusion” over information submissions.
The company also argued that there would be little incentive for a listed entity to inflate revenues while maintaining earnings, as doing so would compress profit margins.
Responding to queries from Business Standard following Sebi’s interim order, Mehta said the company had already furnished most of the information sought by the regulator.
“We have shared over 400 GB of data and information with the market regulator. We have already provided most of the details but there seems to be a communication gap and confusion. We will be clarifying the matter with Sebi and also again sending all the required documents, which we are confident should clarify the matter,” Mehta said.
The remarks come days after Sebi, in a 109-page interim order, alleged misreporting in the company’s financial statements amounting to Rs 15.15 trillion, or nearly 99 per cent of its reported revenue. The regulator described the alleged misrepresentation as “unheard of” and barred Mehta from trading in Rajesh Exports securities pending further investigation.
Shares of the company — once touted as one of the world’s largest gold jewellery exporters — hit the 5 per cent lower circuit on Thursday to close at Rs 105. The company is now valued at about Rs 3,090 crore, with its valuation declining over 40 per cent so far this year.
Meanwhile, the allegations in the Rajesh Exports matter have reignited concerns over corporate governance standards and raised questions about the investment decisions of large institutional shareholders. The spotlight has particularly fallen on state-owned Life Insurance Corporation of India (LIC), which remains the company’s largest public shareholder with a 10.8 per cent stake as of March 2026.
LIC’s continued holding in the company despite the stock’s prolonged decline and growing regulatory scrutiny has drawn criticism from governance experts and investors, with several market participants expressing concerns on social media.
Proxy advisory firms said the episode raises broader questions about the due diligence processes followed by institutions entrusted with public savings.
“LIC owes a huge responsibility to its policyholders. It should undertake rigorous forensic accounting and due diligence before making investments so that companies with fictitious revenues can be identified at an early stage,” said Shriram Subramanian, founder and managing director of InGovern Research Services.
Experts said institutional investors should reassess their holdings when credible evidence of accounting irregularities emerges and not wait for regulatory action.
Apart from LIC, Mauritius-based Bridge India Fund held an 8.46 per cent stake in Rajesh Exports as of March 2026.
“In the case of public financial institutions, which manage public money and typically have robust investment committees and oversight mechanisms, one can reasonably expect heightened vigilance over large investments, especially where they receive information under investment agreements or through periodic investor interactions,” said Prem Rajani, managing partner at Rajani Associates.
Questions surrounding Rajesh Exports’ accounts first surfaced in 2023 when the National Stock Exchange sought details on certain investments and cash flows. The exchange’s queries were followed by shareholder complaints to Sebi in 2024.
According to Sebi, company funds were routed and layered through personal accounts and related entities without adequate disclosures or supporting documentation. The regulator has also alleged that funds were transferred to Mehta’s personal account for derivatives trading and subsequently recorded in the company’s books as sales and purchase transactions.
Separately, Sebi has referred the matter to the National Financial Reporting Authority (NFRA) for examination of the company’s statutory auditors.
Rajesh Exports said it would continue to cooperate with the regulator and seek to resolve the matter through further submissions.
