Shares of Rajesh Exports Ltd continued their remarkable recovery on Friday, hitting the 5% upper circuit at ₹97.51 and extending gains to nearly 28% over the last five trading sessions. According to reports from ET Now, this marks a significant recovery from the stock's recent lows, with the company now trading only around 10% below its closing level prior to the Securities and Exchange Board of India's (SEBI) interim order. The stock had plunged to a 52-week low of ₹77.05 last week after a seven-session losing streak triggered by SEBI's June 3 interim order, but the recent rally demonstrates strong investor confidence in the company's response to regulatory concerns. The recent surge comes after the stock had tumbled to a 52-week low of ₹77.05 last week, capping a seven-session losing streak.
The sharp decline followed an interim order from the Securities and Exchange Board of India (Sebi), which barred the company and its founder-chairman Rajesh Mehta from accessing the securities market pending an investigation. As reported by ET Now, in its June 3 interim order, Sebi had alleged that Rajesh Exports had overstated its revenue by about ₹15.15 lakh crore between FY21 and FY25. The regulator alleged that the company misrepresented a substantial portion of the revenue reported by its overseas subsidiaries during this period and raised concerns over disclosures related to those entities. The stock has tumbled 55% in 2026 so far and 87% in three years, with its market capitalisation coming down to ₹2,369 crore. The recent decline was triggered by an interim order issued by the Securities and Exchange Board of India (SEBI) on June 3, which barred the company and its founder-chairman Rajesh Mehta from accessing the securities market pending further investigation.
According to NDTV Profit, a significant portion of the reported revenue originated from overseas subsidiaries, particularly Switzerland-based Valcambi SA, which contributed between 97% and 99% of the group's consolidated revenue during the period under review. According to the regulator, around 97-99% of the company's consolidated revenue came from overseas subsidiaries, particularly Switzerland-based Valcambi SA. The allegations have raised questions about the transparency of the company's overseas operations and their contribution to reported financial performance, with the regulator specifically addressing concerns over revenue disclosures from these entities.
In response to the allegations, Rajesh Exports last week issued a detailed clarification, rejecting allegations of wrongdoing and attributing the issue to a reporting misunderstanding. As reported by NDTV Profit, the company stated that its financial statements and revenue disclosures are accurate and that it is preparing a detailed response supported by documents and explanations to address the concerns raised by SEBI. The company said it is cooperating fully while submitting supporting documents to address all concerns raised by the regulator. The company has maintained that the Sebi order is interim in nature and contains only preliminary observations, adding that the variance across different disclosures does not indicate any inconsistency or irregularity as they relate to different reporting parameters.
Despite the extended rally, the stock remains significantly below levels seen before the Sebi action triggered the recent selloff. According to ET Now, Rajesh Exports has seen a sharp short-term recovery, delivering a 27.61 per cent return over the past one week, outperforming the Nifty 50, which rose 1.45 per cent during the same period. However, the momentum fades when viewed over a slightly longer horizon, with the stock down 10.05 per cent over one month, even as the benchmark index gained 1.47 per cent. On a year-to-date basis, Rajesh Exports has declined 45.43 per cent so far this year, compared to an 8.34 per cent fall in the Nifty 50. The longer-term picture highlights sustained weakness in the stock, with the company down 82.78 per cent over three years and 83.88 per cent over five years, while the Nifty 50 has delivered gains of 27.78 per cent over three years and 52.81 per cent over five years. The recovery follows a steep sell-off earlier this month, with the stock witnessing renewed buying interest in recent sessions, and social media chatter also picked up alongside the rally, with "WeSupportRajeshExports" trending on X (formerly Twitter).
