The Securities and Exchange Board of India (SEBI) has passed an interim ex-parte order against NSE SME-listed Kore Digital Limited and three of its key managerial personnel, alleging manipulation of financial statements, non-genuine subsidiaries, inflation of revenue and diversion of funds raised through a preferential issue.
The regulator has restrained Kore Digital, its Managing Director Ravindra Doshi, Chief Executive Officer Chaitanya Doshi and Chief Financial Officer Kashmira Doshi from accessing the securities market for raising funds from the public. The three executives have also been restrained from buying, selling or otherwise dealing in Kore Digital securities, directly or indirectly, until further orders.
SEBI has also directed the National Stock Exchange (NSE) not to permit Kore Digital to migrate from its SME platform to the main board without clearance from the regulator. The order was passed following an examination covering the period from April 1, 2023 to March 31, 2026.
According to SEBI’s preliminary findings, Kore Digital’s consolidated financial statements were allegedly misstated by approximately INR 541.3 crore during FY25 and FY26, representing around 73% of the company’s total revenue during the period.
The regulator attributed the alleged misstatement primarily to three subsidiaries acquired by Kore Digital during FY25 and their step-down subsidiaries. SEBI said the acquisitions appeared to be “fake and non-genuine” and that the entities accounted for a substantial portion of Kore Digital’s consolidated revenue.
The three subsidiaries contributed, on average, around 75% of Kore Digital’s consolidated revenue during FY25 and FY26, according to the regulator. SEBI also examined the entities and their step-down subsidiaries and raised concerns regarding their physical presence, corporate filings and financial records.
The regulator also flagged alleged discrepancies in Kore Digital’s standalone financial statements. SEBI said revenue had allegedly been inflated through transactions involving Navayuga Engineering Company Limited (NECL), Vodafone and Bharti Airtel, to the extent of INR 31.49 crore during FY24 and FY25.
A further INR 26.42 crore of revenue was allegedly recorded through Kashvee Infra Projects Pvt. Ltd. during FY25. SEBI’s examination raised concerns regarding Kashvee’s business operations and its registered premises.
SEBI has also raised concerns over the utilisation of funds raised by Kore Digital through a preferential issue completed in March 2024.
The company had raised approximately INR 40.05 crore through the preferential issue. The regulator found prima facie evidence that a substantial portion of the proceeds had allegedly been diverted primarily to Kashvee Infra Projects Pvt. Ltd. and SD Square Manpower Pvt. Ltd., which SEBI described as fake or non-genuine entities.
The findings have also brought the role of Kore Digital’s statutory auditors under regulatory scrutiny. SEBI has forwarded a copy of the interim order to the National Financial Reporting Authority (NFRA) for appropriate action, if any, concerning the auditors.
SEBI’s examination also examined Kore Digital’s proposed migration from the SME platform to the NSE main board.
The regulator said the contribution of the three subsidiaries was material to Kore Digital’s reported revenue and that, without their contribution, the company’s standalone revenue would have fallen below the applicable threshold for migration during certain periods.
Against this backdrop, SEBI has directed that Kore Digital should not be permitted to migrate to the main board without regulatory clearance.
Pending completion of the investigation, SEBI has decided to appoint a forensic auditor to examine Kore Digital’s books of account from the date of its listing until March 31, 2026.
The regulator has also directed the company to make true and fair disclosures relating to its financial statements, related-party transactions and other information required under the applicable listing regulations.
Kore Digital and the other noticees have been given an opportunity to respond and seek a personal hearing.
