Rajesh Exports under SEBI scrutiny; Telangana MoU lapses without project

Rajesh Exports, selected under the Union Government’s Rs 18,100-crore PLI scheme, signed a high-profile MoU with the Telangana government in 2022 for a Rs 24,000-crore AMOLED display unit. The company’s repeated delays and failure to execute projects have now come under scrutiny following SEBI restrictions.

Hyderabad: The unfolding controversy surrounding Bengaluru-based Rajesh Exports following SEBI restrictions has brought focus on how the company leveraged its global reputation and its selection in the Union government’s flagship Production Linked Incentive (PLI) scheme, to secure high-profile investment agreements across States, without eventually grounding any of the marquee projects it announced.

Rajesh Exports, a Fortune Global 500 company and one of the world’s largest gold refiners, was selected by the BJP-led Union Government in March 2022 as one of the successful bidders under the Rs 18,100-crore PLI scheme for Advanced Chemistry Cell (ACC) battery storage. The selection, made after a competitive process involving several major companies, gave the firm significant credibility.

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Riding on this recognition, the company approached the then BRS government in June 2022 with a proposal to establish an AMOLED Display FAB unit in Telangana with a projected investment of Rs 24,000 crore.

A Memorandum of Understanding was signed, but officials maintain that it was only an expression of intent, with all incentives linked to actual project execution.

According to senior officials, the Telangana government neither allotted land nor released any financial incentive to the company. As the project failed to progress beyond the proposal stage, the agreement automatically lapsed.

“The company was expected to ground the project within two years, but it kept delaying and eventually stopped responding,” a top official of the Industries department said.

Interestingly, even as the Telangana proposal remained on paper, Rajesh Exports went on to execute another high-profile agreement in January 2023 with the Union Government and the BJP government in Karnataka for setting up a lithium-ion battery manufacturing facility under the same PLI programme.

As the company failed to establish its unit within the stipulated two years, it sought an extension in May last year. But the Centre rejected the request and levied penalties as per the agreement.

While questions are now being raised over the company’s financial affairs and the role of central regulatory agencies, including those that approved its PLI participation and institutional investments, officials insisted that there was no financial exposure for Telangana.

No land was transferred, no subsidy was released, and no public money was spent, they said, adding that the proposed investment never moved beyond the MoU stage.