The Securities and Exchange Board of India (SEBI) has issued an interim order barring Rajesh Exports Chairman Rajesh Mehta from trading in the company’s securities amid allegations of massive financial misrepresentation. The regulator has ordered a fresh forensic audit of the firm’s books, while the Ministry of Heavy Industries evaluates the company’s future in the production-linked incentive (PLI) scheme for advanced chemistry cell battery storage.
Why SEBI Issued an Interim Order
In a 109-page ex parte interim order dated June 3, 2026, the market regulator alleged that Bengaluru-based Rajesh Exports inflated its revenue by ₹15.15 lakh crore between the 2021 and 2025 financial years. SEBI claims this figure represents approximately 99.8% of the revenue attributed to the firm’s subsidiaries during that period, characterizing the reporting as materially misrepresented.
Beyond revenue inflation, the regulator’s investigation points to broader governance concerns. SEBI has alleged fund diversion, opaque related-party transactions, and disclosure failures linked to two specific entities involved in the company’s lithium-ion cell business: Elest Pvt Ltd and ACC Energy Storage Pvt Ltd. Pending further proceedings, Rajesh Mehta is prohibited from buying, selling, or dealing in Rajesh Exports securities.
The Future of PLI Benefits
The Ministry of Heavy Industries (MHI) is currently reviewing its relationship with Rajesh Exports, which is a beneficiary of the government’s PLI scheme for advanced chemistry cell (ACC) battery storage. According to sources within the ministry, there is a "strong view" that the company should be removed from the list of beneficiaries following the SEBI order.
The final decision rests with Minister of Heavy Industries H.D. Kumaraswamy. Ministry officials are expected to finalize the company’s status under the incentive program in the coming days, following the minister’s return from an official visit to Kyrgyzstan.
Corporate Response
Rajesh Exports and Chairman Rajesh Mehta have publicly contested the findings presented in the SEBI order. The company stated that it is actively cooperating with the regulatory investigation. The firm maintains that the discrepancies noted by the regulator may stem from a misinterpretation of financial data, specifically regarding how EBITDA figures for its subsidiary, Valcambi, were categorized.
Key Developments at a Glance
- Regulatory Action: SEBI issued an ex parte interim order on June 3, 2026, citing financial misrepresentation.
- Alleged Scale: The regulator alleges ₹15.15 lakh crore in inflated revenue between FY21 and FY25.
- Leadership Impact: Chairman Rajesh Mehta is barred from trading in company shares pending further investigation.
- Government Oversight: The Ministry of Heavy Industries is weighing the removal of the company from the ACC battery storage PLI scheme.
- Company Stance: Rajesh Exports denies the allegations and is currently cooperating with the ongoing probe.