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Vedanta Resources Ltd share price fell 5.5 percent intraday after a Viceroy Research report claimed the company resembles a Ponzi scheme.
Vedanta shares fall sharply on Wednesday.
Vedanta Share Price: Vedanta Resources Ltd shares dropped 8 per cent intraday on Wednesday following a Viceroy Research report that claimed the company “resembles a Ponzi scheme.”
According to the Viceroy report, the group’s structure is financially unsustainable, operationally compromised, and akin to a Ponzi scheme.
At the time of writing this report, the stock was trading at Rs 434.25 per share, reflecting a 4.54 per cent decline. The stock had opened at Rs 461 per share, compared to the previous day’s close of Rs 456.30 per share.
Shares of Hindustan Zinc also fell 3 per cent intraday following the reports. Shares were trading at Rs 424.40 apiece, against the day’s opening at Rs 437.30 apiece.
Vedanta – Limited ResourcesViceroy is short of Vedanta Resources (PropCo), the heavily indebted parent & majority owner of Vedanta Limited (NSE : VEDL). The group structure is financially unsustainable, operationally compromised, & resembles a Ponzi scheme. $VEDL 1/ pic.twitter.com/U15v9tlnPm
— Viceroy (@viceroyresearch) July 9, 2025
A Ponzi scheme is a type of financial fraud that promises high returns to investors but actually pays those returns using money from new investors instead of from legitimate profits.
Viceroy, which disclosed a short position on VRL, claimed the group is teetering on the brink of insolvency. “VRL is a parasite holding company with no significant operations of its own, propped up entirely by cash extracted from its dying host: VEDL,” the report said.
According to Viceroy, the parent company is systematically draining VEDL’s resources, forcing the operating entity to incur increasing levels of debt and deplete cash reserves. The report argues that such practices severely erode VEDL’s fundamental value, which also serves as collateral for VRL’s own creditors.
Among the red flags highlighted are:
Bait and switch funding model for unviable capital projects
Irreconcilable interest expenses far exceeding reported rates
Inflated asset values across non-performing subsidiaries
Fraudulent CAPEX accounting practices
Billions in off-balance sheet items
Systematic governance failures
Viceroy believes that even one of these risks could bring down what it calls Vedanta’s “financial zombie” structure. It warns that the group’s strategy of using continuous debt and artificial accounting tricks is not sustainable.
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