Rajesh Mehta says SEBI's interim order reflects a misunderstanding of the gold refinery business model; company submits five years of audited sales data

SEBI Order Triggers Controversy

The chairman of Rajesh Exports, Rajesh J. Mehta, has come out strongly against media reports claiming a ₹15.15 lakh crore fraud at the Bengaluru-based gold company, saying the entire controversy stems from a fundamental misreading of how gold refinery businesses record revenue.

The Securities and Exchange Board of India issued an interim order — running to 109 pages — following a shareholder complaint that alleged discrepancies in the company's financial records. SEBI's observations noted that the company appeared to have inflated 99% of its total reported revenue over a five-year period. However, Mehta is categorical that no final order has been passed and no penalty imposed.

"These are observations, not charges," he said, adding that the matter will be resolved once regulators review the complete documentation.

The Valcambi Factor

At the heart of the dispute is Valcambi, a Switzerland-based step-down subsidiary of Rajesh Exports and one of the world's largest gold refineries. The company sells refined gold bars to central banks and major bullion dealers globally, generating very high turnover with razor-thin profit margins.

Mehta explained the business model with a straightforward example. If Valcambi imports impure gold worth ₹100, refines it, and sells it for ₹101, the total recorded revenue is ₹101 — even though the actual gross profit is just ₹1. Net profit after expenses typically works out to 25 to 50 paise on that transaction.

According to Mehta, SEBI may have mistakenly treated the EBITDA figures as a proxy for gross profit and, finding a large gap with reported sales, concluded the numbers were inflated. "They added up the EBITDA instead of looking at the actual sales data. That's where the confusion started," he said.

The company says it has submitted full, audited sales data for financial years 2020 to 2025 to SEBI and the stock exchanges.

Revenue Structure Explained

Rajesh Exports reports consolidated revenue combining two streams: Valcambi's global bullion sales, which form the bulk of the total figure, and the Indian parent company's standalone revenue from domestic jewellery and bullion operations. The latter has stayed in the range of ₹20,000 to ₹25,000 crore over the five-year period in question.

Consolidated revenue from operations stood at ₹2.58 lakh crore in FY2021, climbing to ₹7.78 lakh crore in FY2026 — figures dominated almost entirely by the Swiss subsidiary's high-volume gold trading.

Forensic Audit and Data Sharing

Mehta pushed back on claims that the company withheld information from forensic auditors, saying the audit has been underway for two and a half years and auditors had access to the office premises for three months. He said the ERP system and books of accounts were made fully available in compliance with applicable rules.

On certain data related to Valcambi's client transactions — specifically, which central banks purchased how much gold — Mehta cited international secrecy laws and non-disclosure agreements. He said disclosing such details would expose competitive strategy and could create complications for sovereign clients. The audited balance sheets of both Valcambi and its holding company Gezear, audited by KPMG, have been submitted to SEBI along with all relevant schedules.

LIC Stake, Promoter Holdings

LIC holds roughly 10% in Rajesh Exports, a stake accumulated gradually over 15 to 20 years through open-market purchases. Mehta pointed out that LIC has not bought a single new share in the company over the past four to five years. He also stated that promoters have never sold shares to LIC or to anyone else — their holding remains unchanged from day one, and the family has in fact purchased additional shares from the market from time to time.

The company is also debt-free, with no outstanding loans to any bank or institution globally.

Company's Next Steps

Rajesh Exports is preparing a detailed legal and factual response to SEBI's interim order. Certified documents and audited balance sheets from Valcambi and Gezear are being resubmitted to the regulator. The company has already filed clarifications with BSE and NSE on June 4, 5, and 6.

Mehta expressed confidence that SEBI's concerns would be fully addressed once the complete documentation is examined. "The moment the atmosphere clears, the stock will return to its real value," he said, urging investors not to panic over what he described as temporary market sentiment.

Commercial LPG Price Hike and New Financial Rules Effective May 1

The month of May brings a series of significant economic adjustments for Indian consumers, headlined by a steep hike in commercial LPG cylinder prices and a revamp of regulations governing the online gaming industry. While household cooking gas remains unaffected, the commercial sector faces its sharpest single-day price increase on record.

Commercial LPG Costs Surge

State-owned oil marketing companies have implemented a record-breaking hike for commercial LPG cylinders, effective Friday, May 1, 2026. In the national capital, the price of a commercial LPG cylinder has jumped by ₹993, bringing the new rate to ₹3,071.50. Similarly, the 5-kg FTL cylinders have seen their rates climb from ₹549 to ₹810.50, marking a significant inflationary shift for restaurants and small businesses.

Opposition leaders have been quick to react to the development. Rahul Gandhi criticized the move, claiming it follows a pattern of price hikes post-elections and warned that further increases in petrol and diesel rates could be on the horizon.

Jet Fuel Export Duty Shifts

In the aviation sector, the price of Aviation Turbine Fuel (ATF) for international airlines has been increased by 5%, marking the second consecutive monthly rise. According to reports from state-owned oil firms, the new rate in Delhi stands at $1,511.86 per kilolitre.

However, there is some relief for domestic refiners. The central government has reduced the Special Additional Excise Duty on diesel exports to ₹23 per litre, down significantly from the ₹55.5 per litre observed in April. Meanwhile, the export duty on ATF has been lowered to ₹33 per litre. Officials confirmed that domestic petrol and diesel prices remain unchanged for the public.

Eased Norms for Gaming

The Ministry of Electronics and Information Technology has introduced updated rules for the online gaming sector, aiming to adopt a "light-touch" regulatory approach. IT Secretary S. Krishnan noted that the government intends to reduce the compliance burden on startups and developers. Key changes include extending the validity of gaming certificates from five years to ten years.

Under the revised framework, games not involving real-money transactions are largely exempt from registration requirements. To enhance user safety, the government has mandated a two-tier grievance redressal system, and the Ministry of Home Affairs is now authorized to block platforms that violate established safety protocols.

New Disclosure Rules for Brokers

Starting today, Sebi-registered entities—including stock brokers, mutual fund houses, and research analysts—must prominently display their registration names and numbers on their primary social media handles. This mandate requires these details to be included at the beginning of any securities market-related content. Market observers suggest this move is aimed at curbing the spread of unauthorized financial advice and improving investor protection across digital platforms.

PhonePe IPO Roadshow: A $15 Billion Gamble on India's Fintech Future

Walmart, the largest shareholder, will sell about 9% of its stake, while early backers Microsoft and Tiger Global will cash out completely.  

Image: A visual representation of a smartphone with the PhonePe logo, with financial growth charts and the Indian stock exchange index in the background.

PhonePe, India's undisputed leader in digital payments, has officially fired the starting gun on its journey to the stock market. With a fresh regulatory green light in hand, the company has filed updated papers for what is poised to be one of the country's most significant fintech listings, targeting a blockbuster valuation of around $15 billion. This PhonePe IPO is more than just a listing; it's a major liquidity event for its powerful backers and a critical test of investor appetite for a high-growth, yet loss-making, consumer tech champion.

 The Investor Exit Strategy: Who's Cashing Out?

The structure of the offering tells a clear story. The PhonePe IPO is a pure Offer for Sale (OFS) of up to 5.06 crore shares. This means the company itself will not raise any fresh capital. Instead, the entire ₹12,000 crore (approx. $1.35 billion) proceeds will go directly to the selling shareholders.

   Walmart's Strategic Trim: Through its entity WM Digital Commerce Holdings, the US retail giant is the promoter and will remain the dominant force, selling 4.59 crore shares (about 9% of its holding). Post-IPO, Walmart will retain a controlling stake of over 62%.

   Complete Exits for Early Backers: In a clean break, both Microsoft and Tiger Global are selling their entire holdings in the company through the offer. This marks the full exit of these early investors via the public market.

The Financial Contradiction: Soaring Revenue Meets Mounting Losses

Ahead of its debut, PhonePe presents a financial picture of powerful growth shadowed by significant losses.

Recent Financial Performance at a Glance:

| Period | Revenue from Operations | Year-on-Year Growth | Reported Net Loss |

| Full Year FY25 | ₹7,114.8 crore | 40.5% | ₹1,727.4 crore |

| First Half of FY26 | ₹3,918.5 crore | 22.2% | ₹1,444.4 crore |

While the company highlights strong adjusted profitability (Profit After Tax excluding ESOP costs tripled to ₹630 crore in FY25), the reported bottom line is deep in the red. A major factor is the massive ₹2,357 crore in non-cash, share-based payment expenses incurred in FY25, which are a recurring cost linked to employee retention.

 The Core Engine: Unrivaled Market Dominance

The cornerstone of PhonePe's valuation is its formidable position in India's digital payments ecosystem. It is the UPI market leader, commanding a dominant share of nearly 50% by transaction value. The platform boasts staggering scale:

   Over 650 million registered users.

   Nearly 50 million merchant partners.

   Processes billions of transactions monthly, with a remarkably high user retention rate of 99.23%.

 Beyond Payments & Looming Risks

PhonePe is aggressively diversifying its revenue streams beyond payment processing. Its new business segments, like the stockbroking platform Share.Market and the Indus Appstore, are gaining traction but remain heavily loss-making, funded by the cash flows from the core payments business.

However, a significant regulatory cloud hangs over its main business. The National Payments Corporation of India (NPCI) has proposed a 30% volume cap for third-party UPI apps. PhonePe's current ~50% share far exceeds this threshold. While enforcement is deferred until December 2026, this rule remains a key risk factor disclosed in its prospectus.

 Key Takeaways for the Market

1.  A Benchmark for Fintech: As the largest pure-play payments IPO since Paytm, PhonePe's listing will set a crucial valuation benchmark for India's fintech sector.

2.  Investor Confidence Test: The market's reception will test confidence in a "growth-over-profits" narrative, especially as losses continue to widen in the short term.

3.  Regulatory Watch: All eyes will be on how PhonePe navigates the looming UPI market share cap, which could force a fundamental shift in its growth strategy.

With leading global banks like Morgan Stanley, Goldman Sachs, and JP Morgan managing the issue, the PhonePe IPO is set to be a defining moment for India's public markets in 2026. It presents a high-stakes bet on whether India's most-used payments app can translate its massive user base into sustainable profitability for public shareholders.

SEBI Greenlights NHAI's Highway InvIT: Earn Higher Returns Than Bank FDs by Investing in National Highways

In a landmark move for retail investors, market regulator SEBI has approved the National Highways Authority of India’s (NHAI) ‘Highway Infrastructure Investment Trust’ (InvIT). This innovative scheme throws open the doors for everyday Indians to invest directly in the country’s national highway projects and share in the revenue generated from toll collections, potentially earning returns higher than traditional bank fixed deposits.

Gone are the days when such infrastructure projects were only accessible to large institutional or foreign investors. The primary goal of this NHAI InvIT is to democratize infrastructure investment, allowing retail investors to participate in the nation’s growth story while building a portfolio that offers regular income.

Why This Government-Backed InvIT is a Game-Changer

This isn't just another financial product. For the common investor, it presents a unique blend of security and potential yield.

Regular Passive Income: A significant portion of the toll collection earnings will be distributed to investors as dividends. This makes it an attractive option for those seeking steady cash flow, with analysts suggesting returns could outpace most bank FDs.

Built on Government Trust: As an NHAI-sponsored initiative, the InvIT carries the credibility and structural security of a major government body.

Long-Term Wealth Creation: It’s designed as a long-term investment instrument, allowing investors to benefit from India’s expanding highway network over time.

How the NHAI InvIT Works: Your Share of the Toll

Think of it as earning rental income from roads. Here’s a simple breakdown:

1.  You invest by buying units of the listed Infrastructure Investment Trust (InvIT), similar to buying shares.

2.  The InvIT uses this pooled capital to acquire or manage operational national highways from NHAI.

3.  Revenue is generated from the toll tax collected from vehicles using these roads.

4.  After managing operational costs, a large share of the profit is distributed to unit holders (investors) as dividends.

Your Investment is in Expert Hands

To ensure robust management and security, NHAI has appointed ‘Rajmarg Infra Investment Managers Private Limited’ (RIIMPL) as the investment manager. This company is backed by a consortium of ten of India’s largest and most trusted financial institutions, including State Bank of India (SBI), HDFC Bank, ICICI Bank, and Axis Bank. This consortium oversight means investor funds are under expert supervision.

How Can You Invest in the Highway InvIT?

The process is straightforward and familiar to anyone who invests in the stock market:

You will need an active Demat account.

Once the InvIT launches its Initial Public Offering (IPO), you can apply through your brokerage platform (like Zerodha, Groww, or Angel One).

After its stock exchange listing, you can also buy and sell InvIT units on the secondary market, just like equities.

The Bottom Line: Infrastructure Meets Your Portfolio

The SEBI approval of the NHAI InvIT marks a significant shift in how public infrastructure is financed and who can benefit from it. It aligns perfectly with current trends of retail investment participation and seeking alternative, income-generating assets beyond traditional options.

For investors, it’s a chance to contribute to nation-building while aiming for a financially rewarding journey on the very roads that connect India. As with any investment, reading the offer document carefully and assessing your risk profile is advised, but this initiative undoubtedly paves a new road for retail wealth creation.