Rajesh Exports shares slide 10% after SEBI order 2026

Stock hits lower circuit for second straight session

Shares of Rajesh Exports extended losses on Friday, falling another 5% to hit the lower circuit for a second consecutive session after the Securities and Exchange Board of India (SEBI) issued an interim order alleging large-scale financial irregularities. The stock dropped 5% to ₹98.73 on the NSE in Friday’s session. Over two sessions, the shares are down about 10% after investors reacted sharply to the regulator’s observations. The latest move followed a similar 5% lower-circuit close on Thursday.

The sell-off has compounded recent weakness in the counter. Rajesh Exports has fallen more than 12% over one week and 13% over one month, according to the data mentioned in the reports. The stock is also down 42% in 2026 so far. Market attention has remained fixed on the scope of SEBI’s allegations and the company’s repeated denials.

What SEBI alleged in its interim order

SEBI’s interim order alleged that Rajesh Exports and its promoter-chairman Rajesh Mehta misrepresented revenues over multiple years, with the regulator citing prima facie findings from an investigation and forensic review. The order described the suspected inflation in reported revenues as “egregious and unheard of,” stating that around 97% to 99% of the company’s revenue may have been inflated, based on the regulator’s preliminary assessment.

At the centre of the case is SEBI’s allegation that the company misrepresented approximately ₹1,515,000 crore of revenue, accounting for about 99.80% of revenues attributed to subsidiaries between FY21 and FY25. The regulator’s order also flagged concerns around corporate governance and alleged questionable fund-routing practices, as cited in the reports. SEBI said its findings are interim in nature, meaning the investigation is still ongoing and the conclusions are not final.

Restrictions on Rajesh Mehta and the company

As part of the interim action, SEBI restrained promoter Rajesh Mehta from buying, selling, or dealing in securities of Rajesh Exports until further orders. Reports also stated that SEBI has, for now, barred Rajesh Exports and its promoter from accessing the securities market until the completion of the investigation. The regulator directed the company to cooperate fully with investigators and to submit documents as required.

Separately, one report noted that SEBI ordered a fresh forensic audit and referred the company’s auditors to the National Financial Reporting Authority (NFRA). These steps are designed to preserve market integrity and ensure evidence is available while the investigation continues.

Trigger: shareholder complaint in March 2024

The interim order followed a shareholder complaint received by SEBI in March 2024, as cited in the reports. The complaint alleged potential financial misrepresentation in the company’s books, leading to the regulator initiating checks that later expanded into a forensic review.

The matter has since become a high-profile corporate disclosure issue, given the size of the revenue figure involved and the claim that the bulk of the reported turnover came from overseas subsidiaries.

Rajesh Exports’ response: “interim order, no adverse conclusion yet”

Rajesh Exports has rejected SEBI’s allegations. In an exchange filing released on Thursday, the company said the order is interim and that no adverse conclusion has been made by SEBI so far. The company maintained that the revenues declared are correct and that no overstating of earnings has been done.

In a multi-point clarification to exchanges, Rajesh Exports also stated that there has been no fine, penalty, or other coercive action by SEBI against the company. It argued that this supports its view that there are no conclusive adverse findings at this stage. The company said it is in the process of clarifying the matter to SEBI by submitting relevant documents.

The Valcambi confusion argument

A key defence put forward by Rajesh Exports is that the “core observation” in SEBI’s order on mis-reporting arose due to confusion, because SEBI allegedly considered the EBITDA of Valcambi instead of revenue. Valcambi SA, the Swiss subsidiary referenced in the reports, is repeatedly cited as a primary source of the consolidated revenue numbers.

Rajesh Exports told exchanges that “the consolidated revenue as stated by the company is correct.” It also said SEBI did not make an adverse observation on earnings, but raised suspicion on revenues that the company believes is rooted in an EBITDA-versus-revenue mix-up for Valcambi.

Rajesh Mehta, speaking to media in an interview referenced in the reports, also defended the company, stating that the alleged misrepresentation stems from officials confusing gross profit with revenue and reiterated that no conclusion has been reached against the company.

Key facts at a glance

Company’s stated consolidated revenue figures cited in reports

One report cited Rajesh Mehta as standing by consolidated revenue numbers, including figures for FY26 and FY25. These were presented in the context of explaining why consolidated turnover is far higher than standalone India operations.

Market impact: what investors are reacting to

The immediate market impact has been visible in the stock’s price action, with back-to-back lower circuits after the interim order became public. Beyond the two-session fall, the stock’s broader decline over the past week and month suggests heightened risk aversion in response to regulatory scrutiny.

The allegation that 97% to 99% of revenue could be inflated, even if only prima facie, is material because it strikes at the reliability of reported scale of operations. SEBI’s market access restrictions and the requirement for full cooperation also signal that the regulator views the matter as serious enough to warrant preventive measures while the investigation continues.

Analysis: why the SEBI-Rajesh Exports dispute matters

This episode has sharpened focus on how investors interpret consolidated revenue, especially where overseas subsidiaries contribute the bulk of turnover. SEBI’s interim observations cite revenue linked to foreign subsidiaries, while Rajesh Exports’ primary rebuttal is that the regulator compared the wrong line item for Valcambi, referencing EBITDA rather than revenue.

The case also highlights how quickly regulatory actions can translate into market outcomes. Even though the company has emphasised the interim nature of the order and the absence of penalties so far, the trading restrictions on the promoter and the company, along with the stated need for a forensic audit, have raised concerns around disclosure quality, verification of subsidiary operations, and auditor oversight.

What to watch next

SEBI’s investigation is ongoing, and the interim order indicates further steps will depend on findings during the probe and forensic work. Rajesh Exports has said it will provide required documents and clarify the alleged confusion around Valcambi’s financials.

For investors, the next milestones are the company’s detailed submission to SEBI, any updates on the forensic audit process mentioned in reports, and any further directions or modifications that SEBI may issue as the investigation progresses.