SEBI has issued a strict order against Varanium Cloud after uncovering a massive accounting fraud. The regulator has banned the company for seven years and directed promoter Harshawardhan Sabale to return ₹128.77 crore. Investigations revealed that the firm created a false picture of growth through fictitious transactions and diversion of funds.
SEBI found that Varanium Cloud reported ₹743 crore of fake sales across two financial periods. Purchases worth ₹501 crore were also fictitious, exposing the scale of manipulation. The regulator highlighted that 95.92% of the company’s FY23 sales were fabricated, showing how investors were misled with inflated numbers.
The order states that Varanium Cloud deliberately misrepresented its financials, violating securities laws and eroding investor trust. By fabricating invoices and diverting funds, the company projected rapid growth that never existed. SEBI’s findings underline how systemic fraud was carried out to attract investors under false pretenses.
This action demonstrates SEBI’s commitment to protecting market integrity. The ban and disgorgement order serve as a warning to listed companies that fraudulent practices will invite strict penalties. The case also highlights the urgent need for stronger corporate governance and transparent disclosures to safeguard investor confidence in India’s capital markets.