The unfolding Rajesh Exports controversy is about far more than allegations of inflated revenues exceeding Rs 15 lakh crore. It arrives at a moment when India is witnessing a profound shift in household savings behaviour, driven by rising economic uncertainty, soaring gold prices and weakening confidence in traditional financial assets.
The Securities and Exchange Board of India (SEBI) has alleged that Rajesh Exports overstated revenues by about Rs15.15 lakh crore, between FY21 and FY25, an amount so large that it rivals a substantial share of India’s annual GDP. The company has denied wrongdoing and attributed the dispute to differences in interpretation regarding subsidiary revenues. The matter remains under investigation.
SEBI’s allegation of Rs 15.15 lakh crore in overstated revenues—equivalent to over 28 percent of the Union Budget—has triggered one of the biggest corporate governance controversies in recent years. It comes at a time when Indians are moving money out of bank deposits and into gold, mutual funds and other assets in search of higher returns and greater security.
The timing of the controversy is striking. It did not happen in a day. The complaint is lodged with the SEBI since 2024. Only on June 3, 2026 the SEBI flagged the issue and stocks went it a low circuit.
Rajesh Exports shares plunged after SEBI issued an interim order alleging that the company overstated consolidated revenues by Rs15.15 lakh crore between FY21 and FY25. The stock hit consecutive lower circuits as investors reacted to concerns over unverifiable overseas subsidiary revenues, accounting practices and corporate governance standards. The company has denied the allegations, but the sharp fall has intensified scrutiny of auditors, institutional investors and regulatory oversight.
LIC, India’s largest insurer, holds a 10.8 percent stake in Rajesh Exports and has remained invested despite the company’s prolonged share-price decline and recent regulatory troubles. The stake, built up significantly over the past decade, has come under scrutiny after SEBI’s allegations of massive revenue inflation. With the stock down nearly 90 percent from its 2023 peak, LIC’s investment—along with the savings of nearly two lakh retail shareholders—has suffered substantial erosion, prompting questions about investment oversight and the deployment of public funds.
The irony is that as gold becomes more attractive, the institutions associated with the gold economy are facing growing scrutiny.
Rajesh Exports was once celebrated as one of the world’s largest gold refiners and jewellery exporters. It represented India’s ambition to become a major global player in precious metals. Today, allegations of accounting irregularities have cast a shadow over that narrative. SEBI’s interim findings raise questions not merely about one company but about corporate governance, auditing standards and regulatory oversight in sectors handling enormous volumes of trade.
The stock market promises wealth creation but often delivers wealth destruction for retail investors. Between FY22 and FY25, more than nine out of ten retail traders in the futures and options (F&O) segment lost money, collectively wiping out nearly Rs2.9 lakh crore. Many others suffered from sharp stock-specific collapses, such as the plunge in Rajesh Exports, which erased thousands of crores in investor wealth.
A clutch of non-resident Indians (NRIs) and foreign portfolio investors (FPIs) divested a chunk of their shareholding over the past three years at the expense of small retail shareholder in Rajesh Exports.
Interestingly as these institutional and wealthy investors sharply pared their stakes, the company’s price plunged by a staggering 87 percent over three years till March 30, 2026.
Retail investors holding up to Rs 2 lakh each held just 1.6 percent of the company’s equity as of Marach 31, 2023. At the quarter, NRIs held a 37 percent stake, and FPIs held 17.6 percent stakes
A year later, retail investors holding jumped to 11.42 percent and in March 2026 NRI holding plunged to 7.35 percent and that of FPIs to 15.08 percent.
Between March 2023 and March 2026 when retail raised their stakes; NRI and FPI sharply cut theirs, the Rajesh Exports scrip plummeted 87 percent to a five-year low of Rs 80.38 by FY 26 end from Rs 619.10 by FY 23-end, as per Bloomberg. The price recovered to Rs 103.92 as the stock isfrozen at the 5 percent lower circuit
Midas touch or Mythical Value!
At a time when Indians are rushing towards gold as a safe haven amid falling bank deposits and volatile markets, a striking contradiction has emerged. The RBI insists its physical gold holdings remain unchanged at 880.52 tonnes and gold’s share in India’s forex reserves has risen to nearly 17 percent. Yet official data showed the value of those holdings falling by about Rs46,000 crore in a single week of May 2026, fuelling speculation over reserve management and possible market operations.
Against this backdrop of soaring gold prices and growing public faith in the yellow metal, one of India’s largest gold-linked companies, Rajesh Exports’ shares crashed after SEBI alleged revenue inflation of Rs15.15 lakh crore between FY21 and FY25, triggering concerns over accounting practices, corporate governance and auditor oversight. The juxtaposition is stark: as households shift savings from bank deposits to gold in search of safety and trust, a flagship player in the gold business is facing allegations that have wiped out substantial investor wealth surrounding India’s gold economy.
Unexpected Boom, Falling Bak Deposits
India is experiencing an unprecedented gold boom amid inflation fears and currency stability.
At the same time, bank deposits are losing their traditional dominance.
Savings deposits accounted for only 28.7 percent of aggregate bank deposits in March 2026, down sharply from 34.6 percent in March 2022. Demand deposits stood at Rs31.65 lakh crore in May 2026, while overall deposit growth slowed to 12.2 percent, well below the long-term average of 14.7 %.
This is more than a banking statistic. It is a signal of changing public behaviour. For decades, Indian families parked surplus savings in bank accounts and fixed deposits. Today, many are moving towards gold, mutual funds, equities and real estate. The attraction is obvious. Inflation has eroded real returns on deposits, while gold has delivered spectacular gains.
The Rajesh Exports signify that gold may be safe but an economy cannot build its future solely by storing wealth in vaults and jewellery boxes. The crash of a gold-based company, its investigations open up the literal Pandora’s box. Gold can also have muck. And a safe bait may not be that safe.
Sunday, June 28, 2026