Corporate fraud has not decreased in the country. This time another big scam was caught in the country. Courtesy Rajesh Exports Ltd. Markets regulator Sebi has claimed that the company committed a financial fraud of Rs 15 lakh crore. Several nationalized institutions were shocked by this news. The first of these is LIC. The insurer owns more than 10 percent of the company.
Rajesh Exports Limited (REL) is the country’s largest gold refiner and jewelery manufacturer, according to stock market data in India. Market regulator SEBI has taken extreme action against the company. SEBI has issued an interim order against the company’s managing director Rajesh Mehta and the company for alleged financial irregularities, false revenue accounts and failure to cooperate with investigations.
Shares of Rajesh Exports fell on this news today (Thursday). Shares of the company fell nearly 5 per cent to Rs 103 at the market open. Shares have fallen as much as 40 percent in the past year.
The findings revealed in SEBI’s interim report are startling. SEBI has claimed that Rajesh Exports has submitted inconsistencies or incorrect information in its consolidated revenue from FY2020-21 to FY24-2 which is about 99.80 percent of the total revenue shown by the company during that period!
How did this financial fraud happen? The investigation revealed that 97 to 99 percent of the company’s total revenue came from foreign subsidiaries, particularly ‘Valkambi SA’. However, after examining Valkambi’s own audited financial reports, SEBI found that only a small portion of the huge income shown at the core group level was actually there.
SEBI alleged that the agency misled investors by showing the entire gold transaction value or gross value as revenue instead of the actual income from gold refining or processing. They produced no proper invoices, customer information or accounting documents to support this.
SEBI has advised the National Financial Reporting Authority (NFRA) to look into the matter and examine the role of statutory auditors of companies.
Life Insurance Corporation of India (LIC) suffered huge losses in the Rajesh export crisis. Rajesh Exports, the country’s largest institutional investor, has about 10.80 percent. LIC has not bought or sold these shares since September
LIC’s investment value has fallen drastically due to sharp fall in share price. LIC’s stake in Rajesh Exports was valued at Rs 637 crore at the start of 2026 but has now come down to just Rs 347 crore.
Not only LIC but also foreign portfolio investors (FIIs) have been affected. However, realizing the condition of the company, they have been continuously reducing their stake for the past three years. FII holding has come down from 17.60 per cent in March to 14.26 per cent in March 2026 The company is currently heavily invested mainly by Bridge India Fund (8.46 per cent) and Scab Fundamental Emerging Markets Equity ETF (2.70 per cent). However, FII holdings have also come down from Rs 838 crore to Rs 456 crore due to the current fall in shares.
This is not the first time Rajesh Exports has been questioned about financial fraud. In 2023, the National Stock Exchange blamed the company for failing to file a statement of cash flows for the 2023 financial year. The company was also accused of concealing the audit report and accurate cash flow data for the September 2023 quarter. After SEBI’s crackdown, the future of Rajesh Mehta and his company remains to be seen in the coming days.