Rajesh Exports chairman Rajesh Mehta has declared that the company will not contest the interim order issued by the Securities and Exchange Board of India (Sebi) regarding alleged revenue inflation. According to Mehta, the company is fully cooperating with the regulator and has already submitted between 40,000 and 50,000 documents along with more than 300 GB of data.
Background of Sebi Investigation
Sebi, in a 109-page interim order, alleged that Rajesh Exports inflated its revenues by Rs 15.2 lakh crore between FY21 and FY25. The regulator claimed that the company misrepresented 99.8% of its total consolidated revenue during that five-year period. This was first reported by the Times of India.
Company's Response and Cooperation
Mehta stated, "We do not see this as a matter that requires contesting. We are cooperating fully with Sebi and are submitting all documents and information requested by the regulator. To date, we have already responded to some 2-3 queries." He further added that there has been no adverse regulatory action against the company. "The company has not been barred from conducting business, nor has any penalty been imposed. We remain committed to complying with all regulatory requirements and will continue to engage constructively with Sebi throughout the process," Mehta told TOI.
The company reiterated in a stock exchange filing that Sebi's order is only an interim order raising suspicions, not containing conclusive adverse findings. Rajesh Exports maintained that neither the company nor its personnel were involved in any wrongdoing or misrepresentation.
Role of Swiss Subsidiary Valcambi
Responding to Sebi's observations, Rajesh Exports argued that the regulator had misunderstood the nature of its business. The company explained that a substantial portion of its consolidated revenue is generated by its Swiss subsidiary, Valcambi, which refines and sells gold bullion to major banks, central banks, and large bullion market participants globally.
Revenue Breakdown and Business Model
| Period | Consolidated Revenue | Standalone Revenue (India Operations) |
|---|---|---|
| FY21–FY25 (alleged inflated) | Rs 15.2 lakh crore | Not specified |
| FY26 | Rs 7.8 lakh crore | Rs 9,200 crore |
Mehta noted that the standalone revenue of about Rs 9,200 crore reflects the company's India operations, while the bulk of the consolidated revenue comes from Valcambi. For FY26, the group's consolidated revenue stood at Rs 7.8 lakh crore.
Implications for International Trade
Rajesh Exports is one of India's largest gold exporters and importers. Its Swiss subsidiary Valcambi is a globally recognized gold refiner, supplying central banks and financial institutions. While no business restrictions are currently in place, any future regulatory action could impact gold supply chains, particularly for Indian exports and Swiss refining operations. Trade partners and counterparties should monitor the investigation's progress closely, as the company continues to submit documents to clarify its revenue structure.
The company has fully engaged with forensic auditors appointed by Sebi and expects to clarify the matter once all documents are reviewed. Mehta expressed confidence that the issue will be resolved shortly.
What to watch: The outcome of Sebi's ongoing investigation and any further regulatory findings that could affect Rajesh Exports' ability to operate in international gold markets.
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