Indian Enforcement Directorate investigation finds multiple violations by gold giant Rajesh Exports, shares hit limit down

(1) The Indian Enforcement Directorate has discovered multiple accounting and operational irregularities at Rajesh Exports, one of the country's largest gold companies: incomplete overseas transaction records, accounting discrepancies amounting to 30 billion rupees, suspected stock manipulation, and approximately 40% underreporting of physical gold inventory. The company's key business metrics are "significantly deviating from normal commercial practices," with the managing director receiving a monthly salary of only 17,000 rupees and the chief financial officer not having been paid since 2020. (2) In previous weeks, another investigation by the Securities and Exchange Board of India (SEBI) found that 97%-99% of the company's revenue appeared to be overstated. Regulators described this gap as "serious and unprecedented" and issued a notice demanding an explanation. Last year, the company reported consolidated revenue of over 7.7 trillion rupees (approximately $81 billion). (3) Rajesh Exports previously responded by stating that "there has never been any false reporting" and that all financial data are true and reliable. After the news was released, the company's share price fell by about 5% on Thursday and triggered a price limit down.