Rajesh Exports Shares Fall and Freeze as ED Probe Flags Salary Practices, Financial Irregularities

Mumbai, June 25: Rajesh Exports share price fell sharply to 5% lower circuit on Thursday after fresh Enforcement Directorate (ED) scrutiny into the company’s financial and compensation practices added to already heightened regulatory concerns surrounding the gold exporter. 

The stock came under heavy selling pressure as investigators reportedly questioned “unusual” salary structures and management compensation patterns, alongside broader probes into potential violations of foreign exchange rules and inconsistencies in financial disclosures. The latest developments deepen an ongoing multi-agency examination of the company’s accounting practices and overseas transactions. 

The ED action follows earlier regulatory concerns flagged by the Securities and Exchange Board of India (SEBI), which had triggered a sustained sell-off in the counter over the past several sessions. Investor sentiment has remained weak as markets continue to digest allegations involving revenue irregularities, stock mismatches, and opaque cross-border dealings. As regulatory scrutiny intensifies, The Economic Times reported that the Ministry of Corporate Affairs has initiated a Serious Fraud Investigation Office (SFIO) probe into the company. 

Stock extends losses amid regulatory overhang 

Stock has fallen 14% over a month, seeing repeated lower circuits since SEBI’s interim order earlier this month. Source: NSE 

The latest fall adds to an already steep downtrend in Rajesh Exports, which has seen repeated lower circuits since SEBI’s interim order earlier this month. The stock has been under pressure amid fears of prolonged regulatory action, forensic audits, and potential governance lapses, all of which have weighed heavily on market confidence. 

SEBI’s interim order dated June 3 alleged that Rajesh Exports inflated its consolidated revenue over a five-year period by routing a substantial portion of reported sales through overseas subsidiaries, particularly Switzerland-based Valcambi SA, even as the subsidiary’s audited standalone accounts reflected significantly lower revenue figures. 

Following the order, the regulator restrained the company’s promoter from buying, selling or otherwise dealing in the firm’s securities until further directions in the matter. 

According to reports, the ED’s probe is examining suspected foreign exchange violations, missing transaction records, and discrepancies in declared financial data, including questions around trade settlements and overseas investments. Authorities are also assessing whether certain transactions were routed through undisclosed or questionable foreign entities. 

The company, however, has consistently denied wrongdoing in previous filings, stating that its financial disclosures are accurate and any discrepancies stem from differences in interpretation of accounting data. It has also said it is cooperating with regulators and will provide all necessary documentation. 

Investor sentiment remains weak 

The combined regulatory scrutiny from SEBI and the ED has intensified concerns around corporate governance and financial transparency at the company. Market participants say the absence of clarity and the scale of allegations have significantly eroded investor confidence, resulting in sustained selling pressure. 

Broader concerns also include potential impact on institutional holdings and operational visibility if investigations deepen or lead to further enforcement action. Analysts note that sentiment is likely to remain cautious until there is clearer regulatory resolution or official clarification from authorities. 

For now, Rajesh Exports remains firmly under the market scanner, with volatility expected to persist as multiple investigations continue to unfold. 

Source: 

• https://www.nseindia.com/get-quote/equity/RAJESHEXPO/Rajesh-Exports-Limited