Vedanta shares slide upto 8% after US-based short seller labels Group a ‘Ponzi Scheme’

Shares of Vedanta Ltd plunged as much as 8% intraday on July 9, before paring some losses, after US-based short seller Viceroy Research issued a scathing report on its parent Vedanta Resources.

The note called the group “financially unsustainable, operationally compromised, and resembling a Ponzi scheme.”

At the time of writing, Vedanta shares were trading 3.5% lower at ₹439.60 on the NSE, while Hindustan Zinc Ltd — another group company — was down 2.6% at ₹424.

Viceroy Research is known for its investigations into major corporate scandals, including Wirecard and Steinhoff.

Viceroy’s allegations on Vedanta

Viceroy’s central claim is that Vedanta Resources, the UK-based holding company controlled by Anil Agarwal, is “a parasite holding company with no significant operations of its own, propped up entirely by cash extracted from its dying host: Vedanta Ltd.”

“This creates a self-destructive feedback loop,” the report said, alleging that Vedanta Ltd’s equity — used as collateral for Vedanta Resources’ borrowings — is being compromised by the group’s financial practices.