The jewellery maker Rajesh Exports has come under the market regulator’s lens as the Securities and Exchange Board of India (SEBI) has found financial irregularities in the company’s books of ₹15.15 lakh crore over five fiscal years.
In a 109-page order, has detailed how the company and its promoter have inflated revenue scale over the years, largely via unverified overseas entities. Following its order last evening, Rajesh Exports share price came under intense selling pressure on Thursday, 4 June.
The hit the day’s low of ₹104.65, its against its last closing price of ₹110.15 per share. There were only sell orders on the counter as investors looked to exit Rajesh Exports shares amid Sebi’s order overhang.
As of 11.12 am, some 3.35 lakh shares were up for sale on BSE and another 20.61 lakh on the National Stock Exchange. In recent years, the company has only eroded investor wealth. Data from NSE shows that Rajesh Exports share price has crashed 42% in 2026 so far, 49% in a year, 82% in three years and 81% in five years.
₹12,725 crore public wealth eroded since June 2023
SEBI in its order stated that following the non-filing of cash flow statements for FY 2022-23, Rajesh Exports share price has been in a continuous downtrend since June 2023 onwards. The share price eventually declined to ₹80.11 on 2 April 2026, corresponding to a market capitalisation of approximately ₹2,365.33 crore.
At its peak in February 2023, the stock was priced at ₹1,028.40. This decline represents erosion of approximately ₹27,999.21 crore in the market capitalisation of Rajesh Exports from its peak market capitalisation. Considering the public shareholding, the aforesaid erosion in market capitalisation resulted in a substantial dent to public investor wealth of approximately ₹12,725.53 crore, said SEBI in its order.
LIC, retail investors trapped?
In the last six years, the number of shareholders of Rajesh Exports has increased substantially from 22,472 in March 2020 to 198,796 as of March 2026. Marquee names like (LIC) also own a substantial stake in the firm, along with 194,110 retail investors, putting them at risk of further erosion in the value of their shareholding.
As per the March quarter shareholding pattern for 2026, LIC held 3,18,75,887 shares or a 10.8% stake in the company worth ₹333.58 crore at today’s price of ₹104.65. Meanwhile, own 4,17,32,856 shares, representing a 14.13% stake, amounting to ₹436.73 crore. Together, they face the risk of losing ₹770 crore in wealth.
Mahesh Ojha, Mahesh M. Ojha, VP – Research and Business Development at Kantilal Chhaganlal Securities, said from an investor’s perspective, balance sheets, cash flows and promoter track records should be examined closely before investing. Weak operating cash flows despite strong reported earnings can be an important red flag, he said.
“Another warning sign is when a company consistently reports strong financial performance, but its stock price fails to reflect that over an extended period. Market participants with deeper knowledge often react before broader investors become aware of underlying issues,” he noted.
In the case of Rajesh Exports, the stock has underperformed for a long period despite the company’s reported financial numbers. Such divergence can sometimes indicate that investors should investigate more carefully.
He acknowledged that for retail investors, it is impossible to verify every aspect of a company’s operations. However, monitoring cash flows, balance-sheet quality and management credibility can help reduce the risk of getting trapped in such situations, according to Ojha.
Should investors exit Rajesh Exports?
In the current backdrop, investors are looking to exit the small-cap stock but are not finding any buyers, as evident in the market depth on BSE and NSE.
G Chokkalingam, Founder, Equionomics Research, said that if a regulator itself raises serious concerns about a company’s financial reporting or governance practices, the implications can be significant. “In such situations, investor confidence tends to erode sharply, making it difficult for shareholders to exit their positions, particularly when the stock is locked in lower circuits. When governance issues are highlighted by the regulator, liquidity can dry up quickly and investors may find it challenging to sell their holdings,” he noted.
According to the veteran expert, the developments around Rajesh Exports should serve as another reminder for investors to focus on companies with strong corporate governance, established management teams and healthy balance sheets.
Meanwhile, Ojha advised that if opportunities to exit become available, investors may consider evaluating those options, as “uncertainty surrounding the company is likely to remain elevated following the regulatory action.”
Why did Sebi take action against Rajesh Exports?
After finding misrepresented numbers on its books, SEBI barred the company and its owner from the securities markets till it completes its investigation.
As part of its order, Sebi said 97%–99% of Rajesh Exports’ consolidated revenue came from overseas subsidiaries, particularly Switzerland-based Valcambi SA. But the company systematically did not disclose its subsidiaries’ financials in the public domain.
Valcambi SA was projected as the principal operating entity, but disclosed negligible standalone revenues in its audited financial statements. By doing so, Rajesh Exports misrepresented approximately ₹15.15 lakh crore, which represented 99.80% of its revenues from subsidiaries between fiscal 2020-21 and 2024-25.
The regulator also said the company repeatedly failed to furnish detailed information on consolidated operations, including party-wise data on sales, purchases, debtors, creditors and inventory. Rajesh Exports cited Swiss data protection laws and confidentiality obligations to justify the non-disclosure. Sebi rejected the argument, saying those provisions apply to personal data and cannot override disclosure requirements under Indian securities law.
Rajesh Exports recorded ₹11487 crore in sales and ₹11488 crore in purchases with an entity, Affluence Shares and Stocks Private Limited, but Affluence denied any such transactions. The regulator alleged that these were non‑genuine entries linked to owner Rajesh Mehta’s personal derivative trades, used to inflate turnover without real economic activity.
SEBI alleged that Rajesh Exports routed company funds worth ₹339 crore to the owner Mehta’s personal accounts, including for derivative trades, without board or audit committee approval and without proper related‑party disclosures. A total of ₹926 crore was routed without approvals or disclosures.
(With inputs from Reuters)
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