Vedanta Shares Fall 4.5% After Viceroy Research Calls Parent Debt a 'Ponzi Scheme'
Vedanta Shares Tumble 4.5% After Viceroy Research Alleges Parent Debt ‘Resembles a Ponzi Scheme’
Mumbai | July 9, 2025 — Shares of Vedanta Ltd slumped by 4.5% on Tuesday after global financial watchdog Viceroy Research released a scathing report alleging that Vedanta Resources Ltd, the parent company of Vedanta Ltd, is running a debt structure that “resembles a Ponzi scheme.” The sharp drop sent jitters across Dalal Street as investors reacted to concerns over the group’s financial sustainability and high leverage.
According to the Viceroy report, Vedanta Resources has been borrowing heavily to repay previous obligations, creating a circular debt structure that, according to them, mirrors the characteristics of a classic Ponzi scheme. The London-based short-seller further revealed that it had taken a short position against Vedanta’s offshore bonds, citing “aggressive refinancing strategies” and opaque financial disclosures as key red flags.
Vedanta Ltd’s shares on the BSE dropped sharply in early trade, touching an intraday low of ₹268.40 before settling around ₹272.25, down 4.5% from the previous close. The panic sell-off also affected other Adani and metals stocks briefly before stabilizing.
In response, Vedanta Resources issued a statement refuting the claims, calling them “malicious and misleading.” The company clarified that it has successfully managed its liabilities and continues to maintain adequate liquidity through asset monetization and fund-raising from global lenders. “We are committed to our debt reduction roadmap and transparent disclosures,” a company spokesperson said, urging investors not to fall for what they called “market manipulation tactics.”
This is not the first time Viceroy Research has targeted Indian conglomerates. The firm is known for publishing high-risk research notes and shorting companies they allege to have financial irregularities—most notably Wirecard and Adani Group in the past.
Market analysts, however, are divided on the implications of the report. While some see it as a wake-up call for greater financial scrutiny, others caution that Viceroy has a commercial motive and that its claims need to be thoroughly verified by regulators.
Meanwhile, the Securities and Exchange Board of India (SEBI) has taken note of the report and is said to be assessing whether Vedanta Ltd’s disclosures and financial structure comply with norms. A formal investigation has not yet been announced.
The controversy has come at a sensitive time for Vedanta, which is in the process of restructuring its business, including efforts to demerge core verticals like oil & gas, aluminium, and power into separate listed entities. The company had recently announced plans to reduce debt by $3 billion over the next two years through strategic divestments and operational streamlining.
Investors and analysts will now be closely watching how the company addresses these allegations and whether it can restore confidence amid rising scrutiny.
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