Rajesh Exports Surges as Rally Continues, Overcoming SEBI Scrutiny Amid Revenue Allegations
Shares of Rajesh Exports continued their remarkable ascent on Friday, hitting the 5% upper circuit at Rs 97.51. This powerful surge has seen the stock extend gains by nearly 28% over the last five trading sessions. The rally signals a significant recovery for the company following intense regulatory pressure and recent low points.Stock Recovery Against Regulatory Pressure
The sustained upward momentum positions Rajesh Exports dramatically better than its recent lows. The company is now trading only about 11% below the closing level it held prior to the Securities and Exchange Board of India (SEBI) interim order. Last week, a series of losing streaks had driven the stock down to a 52-week low of Rs 77.05.The Core SEBI Allegation and Regulatory Action
The significant volatility stems from SEBI's intervention concerning revenue disclosure practices at the company. The regulator barred Rajesh Exports and founder-chairman Rajesh Mehta from accessing the securities market pending an ongoing investigation. This action was triggered by allegations that Rajesh Exports overstated its revenue across financial years FY21 and FY25 by approximately Rs 15.15 lakh crore.SEBI's investigation focuses specifically on the reporting practices of overseas subsidiaries. The regulator alleged that a substantial portion of the reported revenue came from these entities, noting that overseas subsidiaries, including Switzerland-based Valcambi SA, accounted for 97 to 99% of Rajesh Exports' consolidated revenue during the period under review.
Company Strongly Contests Misrepresentation Claims
Despite the regulatory action, which involves a severe investigation into the firm’s financials, Rajesh Exports has vigorously contested the allegations. The company issued a detailed clarification last week, stating that the SEBI order holds only preliminary observations. It maintained that its revenues and all financial disclosures are genuine.Rajesh Exports confirmed it is actively responding to the regulator's concerns by preparing supporting documents and thorough explanations. The company further clarified discrepancies in figures cited across various exchange disclosures platforms. These differences were attributed to distinct reporting parameters, not inconsistency or irregularity. Specifically regarding FY25 numbers, the variances relating to NSE voting results, scrutinizer report, and BSE shareholding pattern relate to different inputs such as votes actually cast and total paid-up share capital/classification data.
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