Rajesh Exports Share: The shares of Rajesh Exports, a company involved in gold and jewelery business, are still in bad shape. Today, on Wednesday, June 10, during the trading in the stock market, the shares of Rajesh Exports hit a lower circuit of 5% for the 5th consecutive session.

Amidst heavy selling pressure, the share price has now fallen to the level of Rs 84.66. After the serious allegations made by the market regulator SEBI, the shares of Rajesh Exports are continuously falling. Due to this, billions of rupees of investors have been lost.

Shares are continuously falling

In the last one week, the shares of Rajesh Exports have fallen by about 22.6%. It has fallen by more than 30% in one month, 55% in 6 months and almost 58% in the last one year.

This trend of fall in shares became even faster when the news of the Central Government’s Ministry of Heavy Industries expelling the company from the ongoing PLI scheme for Advanced Chemistry Cell Battery Storage started emerging. Since the ACC battery business is one of the important future projects of the company, if the decision is taken that the company is considered ineligible for the scheme, it will be no less than a shock for it.

Where did things start going wrong?

In fact, recently, SEBI in its 109-page interim order has alleged that the company overstated its revenue by Rs 15.15 lakh crore between the financial years 2020-21 and 2024-25, which in reality was about 99.8% of the total revenue of the company’s subsidiaries. SEBI accused the company of suspicious transactions between related parties including fund diversion. After this, SEBI banned the company’s promoter and chairman Rajesh Mehta from trading on the stock market with immediate effect and directed to conduct a forensic audit of the company’s accounts.

How many crores of LIC are stuck?

The stake of foreign institutional investors (FIIs) in the company’s shares has been decreasing for three consecutive years, from 17.6% in March 2023 to about 14.26% by March 2026. Since the market cap of Rajesh Export is Rs 3090 crore and the total stake of LIC in the company is 10.80%. According to this, the investment of more than Rs 300 crore of Life Insurance Corporation of India is stuck in the company.

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Explained: How SEBI caught ‘paper’ business worth Rs 15 lakh crore in Rajesh Exports scam, why did LIC increase its stake?

Rajesh Exports News: Country’s well-known businessman Rajesh Mehta and his gold export company have come under the radar of investigating agencies in recent times. This matter came to light when an investigation into the company’s transactions and business activities began on the basis of a complaint. After which it came to light that the company had committed a scam worth crores. First of all let us know about the owner of Rajesh Exports.

Who is Rajesh Mehta?
The name of the owner of Rajesh Exports is Rajesh Mehta, who is one of the largest gold exporters in India. Rajesh Mehta, resident of Bangalore, is the founder and chairman of Rajesh Exports. In this company of his, gold is refined, jewelery making and exported. Rajesh Export is not a local company of India but a company which has gained global recognition. In the year 2017, Rajesh’s name was at number 61 in the Forbes list of richest people.

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How did the business start?
Rajesh Mehta started his business with just Rs 1200, which he also borrowed from his brother. With this money Rajesh started a small business of silver jewellery. He used to buy jewelery from one city and sell it in another city and gradually expanded his business. In 1989, with only 10 employees, he started a gold jewelery manufacturing unit in the name of Rajesh Exports.

Within a few years, his business reached the international level and he started exporting gold jewelery to markets like Britain, Dubai, America and Europe. After this, Rajesh Exports gradually gained a foothold in everything from jewelery making to gold refining and retail. In the year 2015, the company also took over the world famous gold refinery Valcambi of Switzerland, which further strengthened their business.

One complaint changed the story
At present Rajesh Exports is on the radar only because of one complaint. In fact, in March 2024, a shareholder of Rajesh Exports sent an email to SEBI alleging that a huge amount was being shown as outstanding in the company’s accounts for many years and there could be financial irregularities. This was a common complaint, but after two years this case has become one of the biggest accounting controversies in the country.

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SEBI’s interim investigation report has alleged that Rajesh Exports has misrepresented or hidden the actual position of revenue of about Rs 15.15 lakh crore through its foreign subsidiaries and associated companies between the financial year 2020-21 to 2024-25. However, this is only an allegation by SEBI and the investigation into the matter is ongoing. In such a situation, the final conclusion will come only after the investigation is completed and the arguments of all the parties are heard.

Rajesh Export Shares: Market regulator SEBI has taken strong action against Rojash Export, a company involved in the gold and jewelery business, and its promoter Rajesh Mehta. Due to this, the company’s shares reached the lower circuit of 5% on Thursday, June 4.

This share fell from Rs 103.92 to Rs 104.65 on BSE and NSE. This fall in the company’s shares came at a time when SEBI accused the company’s promoter and chairman Rajesh Mehta of serious financial irregularities and banned his trading in the stock market.

What is the allegation?

According to SEBI’s interim order, the company overestimated its consolidated revenue by about Rs 15.35 lakh crore between the financial years 2021 and 2025. Out of this, revenue of Rs 15.15 lakh crore i.e. about 98.7% was found to be completely fake. The actual revenue was Rs 20111 crore. Many other serious things have come to light in SEBI’s investigation.

Fake companies were created on company papers. Rajesh Exports itself purchased the goods and sold the goods to Khul. Due to this, he went around and inflated the revenue by selling goods to his own companies. The company recorded sales of about Rs 11,487 crore and purchases of about Rs 11,488 crore with a unit called ‘Affluence’ in its standalone books between FY22 to FY24. This was a huge part of the company’s total turnover.

When SEBI investigated, ‘Affluence’ clearly stated that Rajesh Exports was never its customer and there was no transaction with them at the corporate level. ‘Affluence’ revealed that her dealings were only with Rajesh Mehta on a personal level. The investigation found that the company’s money was transferred to the promoter’s personal bank accounts without the approval of the board and audit committee and rules were violated.

According to the rules of the stock market, the money of a public listed company belongs to the shareholders. Promoters cannot route company cash into their private accounts like short or long term loans without proper disclosures and approvals. Such ‘out-and-out transactions’ are often used to conceal financial fraud.

How was it revealed?

In March 2024, SEBI had started its investigation against the company on the basis of a complaint received from a shareholder. The shareholder had mainly raised the issue in the complaint that a huge amount was seen stuck in the books of Rajesh Exports in the form of ‘Trade Receivables’ for years.

When SEBI scrutinized the initial data of the company on the basis of this complaint, it found some irregularities. The company was continuously claiming its turnover was high, but its cash flow and bank balance were not matching with it. SEBI formed an investigation team for investigation. Then an auditor was also appointed for forensic audit of the case.

Impact on stock market and investors

After these allegations made by SEBI, investors’ concerns about the future of Rajesh Exports have increased. The country’s largest insurance company, Life Insurance Corporation of India (LIC), also has a stake in it. LIC has up to 10.8% stake in the company by March 2026. This has dealt a big blow to institutional investors. This stock has fallen by almost 90% from its all-time high.