Mumbai: It is India’s fourth biggest company by revenue, but the managing director of precious metals trader Rajesh Exports (REL) apparently doesn’t know how and from where it gets the biggest chunk of the revenue, show the findings of a regulatory investigation.

In its investigation report, the Securities and Exchange Board of India observed allegedly unscrupulous activities by REL’s promoters, such as accounting irregularities and siphoning off of company funds into personal accounts, and also pointed out lapses by its auditors. The regulator said the company and its auditors were non-cooperative.

“The acts of REL constitute a deliberate device, scheme and artifice to mislead and defraud investors dealing in the shares of REL by portraying an inflated and misleading picture of its operational scale, revenue and financial health,” Sebi observed in its report.

The company, eponymously named after its chairman Rajesh Mehta, is accused of committing an elaborate financial fraud that includes dressing-up of revenues of ₹15.15 lakh crore over the years, personal gold trades covered up as corporate sales and phoney gold mine investments of ₹1,035 crore, according to the interim report.

REL denied the charges of misdeeds. In a press release Thursday, the company said the revenues stated in its financials were correct and that the confusion arose because of a mix-up between Ebitda and revenue numbers at Swiss refiner Valcambi SA, an indirect subsidiary.

Sebi has not made any adverse observation with regard to earnings, the company said, claiming that the regulator has only observed suspicion with regard to revenues which was primarily because of confusion over the Valcambi numbers.
Numbers don’t add up
In fiscal 2025, REL reported consolidated revenue of ₹4.23 lakh crore against a profit after tax of just ₹95 crore, translating into a net margin of barely 0.02%. The year before, on ₹2.8 lakh crore revenue, profit was ₹336 crore.
Experts who have studied the Sebi report and the company’s annual reports say the numbers did not add up. The business appeared to be operating at margins that were not merely thin but structurally negligible, they said.

“It looks like a case of pass-through accounting. There is no value creation. It was ‘flow of gold’ being booked as revenue,” said a leading auditor on the condition of anonymity.

Sebi, which began the investigations in March 2024 following a shareholder complaint about suspected accounting malpractices, said it found that about 97-99% of REL’s consolidated revenues were attributed to its overseas subsidiaries, principally Valcambi. But Valcambi’s own accounts, audited by KPMG SA, recorded only processing fees that were about ₹3,027 crore across five years.

Valcambi refined gold on behalf of clients and never took ownership of the precious metal or recognised the value of gold as revenue in its books. Yet, Global Gold Refineries AG (GGR), the parent of Valcambi that had no independent operating business, recorded gross revenues running into hundreds of crores by including the gross value of gold that actually belonged to others, according to the Sebi report.

Rajesh Exports, which owns GGR through a Singapore subsidiary, used those unaudited figures in its financial statements, significantly bumping up the company’s revenue, it said.

In its press release, REL said: “The core observation in the order is with regard to the misreporting of the revenues. This has emerged primarily due to confusion because Sebi has considered the Ebitda of Valcambi instead of revenue hence it has stated that there is a difference of about 97% in the revenue.”

“There is no reason for any listed entity to inflate revenue and maintain the earnings, this will only reduce the margins of the company, which would be adverse to the company,” it said.

Senior management in the dark
The senior management of REL told regulators that most of them were in the dark about the company’s overseas operations and only the promoter, Rajesh Mehta, dealt with those activities.

“Valcambi SA does not have any gold mine on its own,” managing director Suresh Gowda was quoted in the Sebi order as saying. “It refines the raw gold purchased by it from various entities, whose names I do not recollect, as these things are exclusively handled by Rajesh Mehta, chairman of REL. I have never interacted nor involved with any subsidiary/step-down subsidiary of REL, as these were exclusively taken care of by Rajesh Mehta,” he told the investigators, as per the order.

According to the report, REL booked ₹11,487 crore in sales between 2021-22 and 2023-24 to Affluence Shares and Stocks, a broker that made up to 66% of the company’s standalone revenue for that period. But Affluence, in formal depositions to the regulator, said it had not done any business with REL.

Following the transaction trail, the investigators found out that the transactions were personal gold derivative trades executed by promoter Mehta using his own brokerage account and then recorded in the company’s books as corporate sales, the order said.

The investigators also found that Mehta used corporate funds. As per the Sebi observations, bank records show REL transferred ₹338.90 crore directly into Mehta’s personal accounts between April 2020 and September 2025.

Unlike in the case of Nirav Modi or Gitanjali Gems, who are accused of bank fraud, Rajesh Exports doesn’t appear to have borrowed big from banks or through sale of bonds, according to regulatory filings.

The company’s market cap was just over ₹3,000 crore, as per Thursday’s closing share price. LIC (10.8%) and Bridge India Fund (8.46%) are its major institutional shareholders.

“It is striking that, even at a peak market capitalisation of ₹25,000 crore, the company did not hold any analyst calls, a basic expectation for a listed company of that scale,” said Shriram Subramanian, founder and managing director of InGovern Research Services, a corporate governance advisory firm.

The regulator in 2024 hired BDO India Services to investigate. But the forensic audit faced problems at almost every stage of the investigation. It was denied access to ERP systems and was not provided a complete journal dump, preventing independent verification of transactions recorded in the books, according to the regulatory report.

And the company declined to share subsidiary-level records with the investigator, citing Swiss data protection laws, limiting auditors largely to reviewing financial statements prepared by the management itself rather than underlying evidence, it said.

What’s also come under the scanner was the conduct of statutory auditors for the last few years: CA PV Ramana Reddy, the proprietor at PV Ramana Reddy & Co, and CA PL Venkatadri, partner at BSD & Co.

The company’s FY24 and FY25 annual reports, filed with the stock exchanges, carry an unqualified opinion from BSD & Co, which concluded that the financial statements presented a “true and fair view” in line with Indian Accounting Standards.

The company’s FY24 Directors’ Report noted that the statutory and secretarial auditors had made no qualifications, reservations or adverse remarks.

The Sebi report said for over five months, the auditors sat on the regulator’s request for missing documents and statements.

Emails sent to both audit firms did not elicit any response.

REL closed 5% lower at ₹103.92 Thursday on the NSE. The shares are down from their peak of ₹1,028.40 on February 6, 2023.

SYDNEY — Commonwealth Bank of Australia shares fell 0.63% to close at $163.73 on Thursday, underperforming the broader market as investors weighed persistent inflation concerns and the likelihood of delayed interest rate cuts from the Reserve Bank of Australia.

The country’s largest bank by market capitalization saw modest selling pressure throughout the session, with the decline reflecting broader caution in the financial sector amid mixed economic signals. Trading volume was above average as institutional investors adjusted positions ahead of key inflation data later this week.

Commonwealth Bank has been a standout performer among Australian financials in 2026, supported by resilient net interest margins and strong mortgage lending growth. However, the prospect of higher-for-longer interest rates has begun to weigh on valuations across the sector, as analysts reassess the peak profitability of domestic banks.

The S&P/ASX 200 index finished the session lower, with financial stocks contributing to the downside. While Commonwealth Bank’s fundamentals remain solid — including robust capital levels and conservative lending standards — the stock’s sensitivity to interest rate expectations has become more pronounced in recent months.

Economists now forecast the Reserve Bank will hold its cash rate steady through the remainder of 2026, with the first reduction possibly delayed until early 2027. This outlook contrasts with earlier expectations of earlier easing, which had supported bank stocks through much of the year. Higher rates benefit net interest income in the short term but raise concerns about loan growth and potential increases in bad debts if economic conditions soften.

Commonwealth Bank’s latest quarterly update showed continued strength in its core businesses. Home lending volumes remained healthy despite affordability challenges, while business banking and wealth management divisions delivered steady growth. The bank’s digital transformation efforts have also yielded efficiency gains, helping offset rising operational costs.

Analysts maintain largely positive long-term views on Commonwealth Bank. Its dominant market position, strong brand and diversified revenue streams provide resilience in varying economic conditions. However, near-term headwinds from regulatory scrutiny on mortgage practices and potential slowdowns in consumer spending have tempered enthusiasm.

The Australian banking sector faces several structural challenges. Intense competition for deposits has compressed margins in some areas, while regulatory requirements for capital and liquidity remain stringent. At the same time, opportunities in wealth management and digital services offer growth avenues as customers seek more sophisticated financial products.

Commonwealth Bank has invested heavily in technology to enhance customer experience and operational efficiency. Its mobile banking platform consistently ranks among the highest-rated in the country, and the bank continues to expand its fintech partnerships and data analytics capabilities.

Dividend yields remain attractive for income-focused investors. Commonwealth Bank has a long history of reliable payouts, making it a core holding for many superannuation funds and retail portfolios. The stock’s current yield continues to appeal even as share prices face pressure from rate outlook shifts.

Global factors also influence Australian bank performance. A stronger U.S. dollar and shifting commodity prices affect the broader economy, indirectly impacting credit demand and asset quality. Geopolitical tensions and trade dynamics with China, Australia’s largest trading partner, add another layer of uncertainty.

Despite the daily decline, Commonwealth Bank shares are up modestly year-to-date, reflecting solid underlying performance. The stock has traded in a relatively tight range in recent months, with support near $155 and resistance around $170. Technical analysts suggest the current pullback may offer a buying opportunity for longer-term investors if economic data remains stable.

For retail investors, Commonwealth Bank represents a blue-chip exposure to the Australian economy. Its size and systemic importance provide a degree of stability, though it is not immune to sector-wide challenges. Financial advisers often recommend it as part of a diversified portfolio, balanced with exposure to resources, healthcare and technology.

The broader ASX 200 has shown mixed performance in 2026, with financials and materials sectors experiencing periodic rotation. Commonwealth Bank’s relative stability compared to more cyclical stocks has made it a defensive choice during periods of market volatility.

Looking ahead, the bank’s upcoming earnings report will be closely watched for updates on loan growth, margin trends and bad debt provisions. Management commentary on the economic outlook and capital management strategies could influence investor sentiment significantly.

Commonwealth Bank continues to navigate a complex operating environment. While higher interest rates have supported profitability, the bank must balance this with responsible lending practices and customer support initiatives. Its community investment programs and focus on financial inclusion remain important elements of its corporate reputation.

As Australia’s largest bank, Commonwealth Bank plays a central role in the national economy. Its performance affects everything from home lending availability to superannuation returns. The stock’s movement on Thursday reflects the careful balancing act investors face when assessing financial sector prospects in the current cycle.

Market strategists suggest a selective approach within Australian banking. While Commonwealth Bank offers stability and dividend reliability, other institutions may present different risk-reward profiles based on their business mix and geographic exposure.

The Australian share market’s performance this year underscores its sensitivity to both domestic policy and global developments. For Commonwealth Bank, maintaining operational excellence and adapting to changing customer needs will be key to sustaining its leadership position.

Thursday’s modest decline in Commonwealth Bank shares fits within normal market fluctuations rather than signaling a major shift in fundamentals. The bank’s strong capital position and customer franchise provide a solid foundation for navigating the current environment.

As the trading week continues, focus will remain on economic indicators and sector-specific news. Investors will assess whether the current pullback represents a buying opportunity or signals further caution in the financial sector.

Commonwealth Bank of Australia remains one of the most widely held stocks on the ASX. Its performance continues to influence broader market sentiment and retirement savings for millions of Australians. While near-term volatility persists, the bank’s long-term prospects are supported by its market position and strategic initiatives.