10 Jul , 2025 By : Debdeep Gupta
The shares of Vedanta were trading in the green on July 10, a day after the stock crashed over 8 percent intraday following American short-seller Viceroy Research's allegations regarding its parent company. The shares of the company were trading with marginal gains at Rs 442 apiece in the early trading hours.
US-based short seller Viceroy Research on July 9 said that it has taken a short position on the debt of Vedanta Resources, saying that it resembles a 'Ponzi scheme'. It called the parent company of Vedanta a "parasite holding company with no significant operations of its own, propped up entirely by cash extracted from its dying host, Vedanta Limited".
Anil Agarwal-owned mining conglomerate is systematically draining Vedanta to service its own debt, Viceroy further said. "VRL's actions to meet its short-term obligations directly impair its creditors’ long-term ability to recover their principal, a situation that resembles a Ponzi scheme where Vedanta stakeholders, which include VRL creditors, are the 'suckers'," it added.
Vedanta shares had crashed over 8 percent intraday on July 9 after the report was published. The stock later made some recovery to close 3 percent lower. The recovery was fuelled after Vedanta issued a clarification, strongly denying the claims.
"Viceroy Research report is a malicious combination of selective misinformation and baseless allegations to discredit the Group," Vedanta said in a stock exchange filing. "It has been issued without making any attempt to contact us with the sole objective creating false propaganda. It only contains compilation of various information - which is already in the public domain, but the authors have tried to sensationalise the context to profiteer from market reaction," added Vedanta.
"The timing of the report is suspect and could be to undermine the forthcoming corporate initiatives. Our stakeholders are discerning enough to understand such tactics. In fact, to avoid any responsibility – authors of the report have added various disclaimers that the report has been prepared for educational purposes only and expresses their opinions and are not statements of fact,” the company further said.
Hindustan Zinc shares were also trading in the green at Rs 426.85 today, after seeing a strong downturn yesterday. The American short-seller had alleged that Hindustan Zinc's resources are being "looted" through related-party deals with promoter-family owned companies and unjustifiable brand fees. "Vedanta's crown jewel may be its biggest liability," it said while speaking about Hindustan Zinc.
0 Comment