Sebi Bans Kore Digital, Top Officials From Securities Mkt Over Fin Misstatements; Blocks Mainboard Migration

New Delhi: Market regulator Sebi on Thursday barred Kore Digital and its three top officials from accessing the securities market, citing financial misstatements, non-genuine acquisitions and misuse of funds.

Also, the company’s MD Ravindra Doshi, CFO Kashmira Doshi and CEO Chaitanya Doshi have been restrained from buying, selling or dealing in Kore Digital securities, directly or indirectly, until further orders.

Sebi also directed NSE not to allow migration of Kore Digital from its SME platform to the mainboard until the company obtains clearance from the regulator.

To examine the company’s financial affairs in greater detail, Sebi said it will appoint a forensic auditor to scrutinise Kore Digital’s books of accounts from the date of listing until March 31, 2026.

The directions followed Sebi’s examination of the company for the period from April 1, 2023, to March 31, 2026, which found prima facie evidence of manipulation of books of accounts, misrepresentation and publication of untrue and misleading financial statements.

The regulator flagged the role of three subsidiaries and their step-down subsidiaries, which accounted for a substantial part of Kore Digital’s consolidated revenue during the period.

Sebi said these entities were prima facie found to be non-genuine.

“Consolidated Financial statements of Kore were misstated through its three subsidiaries acquired during FY 2024-25 and their step-down subsidiaries. The acquisition of subsidiaries by Kore was found to be fake and non-genuine, and revenue of Kore to the extent of Rs 541.3 crore has been misstated during FY 2024-25 and FY 2025-26, accounting for 73 per cent (approximately) of total revenue of Kore during the said period,” Sebi noted in its 81-page order.

Apart from the consolidated accounts, Sebi also found discrepancies in Kore Digital’s standalone financial statements. The regulator alleged that the company inflated revenue from clients to present a better financial position and noted differences between bank account statements and entries in its books of accounts.

“Standalone Financial statements of Kore have been misstated to show a better financial position by inflating revenues through NECL, Vodafone and Airtel to the extent of Rs 31.49 crore during FYs 2023-24 and 2024-25, and through a fake entity ie Kashvee Infra Projects Pvt. Ltd during FY 2024-25 to the extent of Rs 26.42 crore,” Sebi said.

The regulator also examined the use of funds raised by Kore Digital through a preferential issue completed in March 2024. Sebi found prima facie evidence that a substantial part of the proceeds was diverted to entities it considered fake or non-genuine.

“Substantial part of proceeds of preferential issue completed in March 2024 have been mis-utilised by diverting money to primarily two entities ie Kashvee InfraProjects Private Limited and SD Square Manpower Private Limited, which are found to be fake / non-genuine,” Sebi said.

Kore Digital was incorporated in 2009 and was listed on the NSE’s SME platform, NSE Emerge, in June 2023.

Against this backdrop, Sebi said the company appeared to have inflated its revenue to meet eligibility criteria for migration to the mainboard.

The regulator said the three subsidiaries contributed an average of around 75 per cent of Kore Digital’s consolidated revenue in FY2024-25 and FY2025-26. Excluding their contribution, Kore Digital’s standalone revenue would have fallen below the threshold required for migration in several periods, the regulator said.

These findings, according to Sebi, raised concerns that shareholders may have taken investment decisions based on manipulated financial statements and an unrealistic price of the company’s shares.

As part of its interim directions, Sebi said, “Noticee nos 1 to 4 (the company and Doshis) are hereby restrained from accessing the securities market by issuing a prospectus, offer document or advertisement soliciting money from the public in any manner”.

Also, Sebi has directed Kore Digital to make true and fair disclosures of its financial statements, related-party transactions and other information required under listing regulations.

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