Vedanta Group. File | Photo Credit: Reuters
Viceroy Research, which has a brief place on VRL’s debt stack, mentioned the Vedanta group construction was “financially unsustainable, operationally compromised” and was a “extreme, under-appreciated danger to collectors”.
“VRL is a ‘parasite’ holding firm with no vital operations of its personal, propped up fully by money extracted from its dying ‘host’: VEDL,” it mentioned.
VRL and its internet of intermediate holding corporations held no materials working belongings and carried about $4.9 billion in gross interest-bearing liabilities as of FY25, mentioned the report. The survival of VRL is dependent upon its skill to extract money from publicly listed VEDL, which holds stakes in group corporations together with Hindustan Zinc and BALCO, it mentioned.
The upstreaming course of was inefficient as a result of a good portion of dividends issued leaks to minority shareholders, as VRL holds solely 56% of Vedanta and 62% of Hindustan Zinc. Among different allegations, the report mentioned VRL has extracted $338 million as “model payment” yearly from VEDL and its subsidiaries in FY24 alone.
VRL used loans from VEDL subsidiaries to buy VEDL inventory on-market, however over $122 million of VEDL loans have been “written off” in a blatant violation of the Companies Act, it mentioned.
The 87-page Viceroy Research report accused VRL of draining VEDL, forcing it to tackle extra debt and deplete its money reserves, impaired collectors’ skill to get well their principal, a scenario that resembled a ‘Ponzi scheme’, it mentioned. VEDL promoted capital-intensive tasks that it couldn’t afford to lift contemporary capital, which was paid out to VRL, it alleged.
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Other allegations included inflated asset values of VEDL’s subsidiaries, capex fraud, bills being saved off-balance sheet, and governance failure.
Shares of Vedanta and Hindustan Zinc slipped 3% every to ₹441 and ₹425 on Wednesday.
Vedanta denies
Vedanta Group dismissed Viceroy Research report as “a malicious mixture of selective misinformation and baseless allegations to discredit the group”.
The launch of the Viceroy report got here only a day earlier than VEDL’s annual normal assembly (AGM).
Terming the report “false propaganda”, the corporate mentioned, “The timing of the report is suspect and could possibly be to undermine the forthcoming company initiatives. Our stakeholders are discerning sufficient to know such techniques.”
The group additional famous that the report’s authors had included in depth disclaimers stating that the content material was instructional and opinion-based, and never factual, it mentioned.
The Viceroy Research is the second assault on the Vedanta Group. In 2018, VRL was delisted from the LSE amid protests outdoors its last annual normal assembly.
Published – July 09, 2025 10:32 pm IST
