There is another report that Viceroy just published:
What’s Really Going On at Vedanta?
Viceroy has uncovered a web of financial engineering and governance red flags involving Vedanta Limited (VEDL), its parent Vedanta Resources (VRL), and a lesser-known but critical player: Serentica Renewables, a company linked to the Agarwal family.
The original long report was published last week, in case you haven’ seen it:
Key Revelations:
Serentica Renewables, a supposedly independent green energy firm, is closely tied to the Agarwals and is being used in opaque financial transactions.
Viceroy alleges that Serentica is being used to siphon funds from Vedanta under the guise of renewable energy investments.
These transactions lack transparency, and no one seems to be asking questions—not investors, not regulators, not the media.
Breakdown: 1. Backdoor Dealings
Serentica has been signing power purchase agreements (PPAs) with Vedanta subsidiaries like BALCO and Hindustan Zinc. But these aren’t normal contracts — they’re:
Non-arm’s-length (i.e., not negotiated fairly).
Guaranteed-profit deals that lock in returns for Serentica, regardless of market conditions.
2. One-Way Value Transfer
VEDL is essentially guaranteeing profits for Serentica, while taking on the financial risk. These contracts:
Are used by Serentica to raise debt.
Don’t benefit VEDL shareholders — they benefit the Agarwals.
3. Hybrid Instruments = Hidden Drain
Serentica has issued hybrid financial instruments to VEDL entities that:
Offer very low returns.
Are structured in a way that protects Serentica but exposes VEDL.
So while it looks like VEDL is “investing” in renewables, it’s actually subsidizing a private venture that’s not accountable to public shareholders.
Questions That Need Answers:
Who really controls Serentica Renewables, and what is its financial relationship with Vedanta?
Why are large sums being funneled into Serentica with little to no disclosure?
Are these transactions masking deeper financial instability within the Vedanta Group?
Why has this not been scrutinized until now?
Why This Matters:
If these allegations are true, shareholders, creditors, and the public are being misled, especially this involves PE giant like KKR! The use of a green energy narrative to potentially divert funds and obscure liabilities is deeply concerning—especially in a time when ESG (Environmental, Social, Governance) standards are under global scrutiny.
I’ve been following their reports like following a TV series, and comparing it with the Adani case, anyone interested I will send my analysis!
@RB1990 What’s wrong here? Whatever makes the market more efficient is good, whether you like it or not. It seems you are highly invested in vdl. Also, don’t get trapped by a politician’s proposal of imputing these action as an attack on India.
You are absolutely correct that whatever makes the market efficient is good, I agree and hope it can stay this way. The question here is how long this structure can sustain, right? The bubbles can keep going, at some point, it will burst eventually, that’s my concern. Btw, not giving any investment advice on this stock, I’m out, purely sharing my observations, it’s gonna be a fun case study
No… It should not be your concern. These inefficiencies had always been present in the market, and it will be in the future too. Take for instance any country, USA (it is notorious in this). check this out: George Soros: The Boom/Bust Cycle Explained | The Acquirer's Multiple® , You can toss his word by saying another n+1 theory in market, but as you gain more exposure in this game, your view toward market will be different.
Really appreciate your thoughtful take! And I agree with you on a few key points. Markets are inherently messy, and inefficiencies are part of the game. Short sellers like Viceroy do play a role in surfacing those inefficiencies, and over time, that can make markets more transparent and efficient.
That said, I think the Vedanta situation goes beyond just “normal inefficiencies” or cyclical boom-bust behavior. What’s being alleged here, especially in the follow-up reports, involves undisclosed entities (BJST, PTCC) and related-party dealings (like Serentica) that could be actively draining value from public shareholders. That’s not just a market cycle.
Also, just to clarify , I don’t believe this will hurt the Indian market as a whole. The impact so far has been limited to Vedanta group companies, and broader indices have remained stable. If anything, regulatory scrutiny or legal action, if it comes, could actually strengthen the market by reinforcing transparency and accountability. That’s a positive signal for long-term investors. But to be honest, since it has been a long existing issues and no one took actions, I think either investors or the short seller should push harder, otherwise no one will act on it.
So I will ask myself:
Are these transactions fair and transparent?
Are minority shareholders being protected?
Is the market fully pricing in these additional risks?
Markets can remain irrational longer than you can remain solvent
First, you must know how to distinguish idioms from principles. You can just remember anything from the internet and keep applying it to things which are completely decoupled from that. Clarity is what the market demands, and with the utmost humility I am saying, it comes from pressing the buy-sell button, not by fiddling with fifth-hand knowledge.
According to a new report by Viceroy, and reported by Economic Times, Hindustan Zinc may have violated its shareholder agreement (SHA) with the Government of India by:
Not seeking government approval for the 2023 brand fee agreement with Vedanta.
Entering into a contract that includes an undisclosed termination clause and lacks commercial justification.
The Government of India owns 27.92% of HZL, while Vedanta Ltd (VEDL) owns 61.84%. The SHA signed during Vedanta’s acquisition of HZL in 2002 includes special provisions that require government-nominated directors’ approval for:
Related-party transactions (Provision 14)
Guarantees or securities to group companies (Provision 16)
Loans or advances above ₹20 crore (Provision 24)
Event of Default!
If HZL is found to have breached the SHA:
It triggers an event of default.
Vedanta must remedy the breach within 15 days.
If not resolved, the Government of India has two powerful options:
Buy Vedanta’s stake in HZL at a 25% discount to market value.
Force Vedanta to buy the government’s stake at a 25% premium.
This clause was designed to protect public interest in a partially privatized company like HZL.
If this is true, this could lead to legal or regulatory action, or even a forced change in ownership.
The board meeting today is expected to address these concerns.
That’s the kind of thing people say to save their arse when things go wrong. Sure, guessing ahead can sometimes help,but when people start using it to support their bias or dreams, it’s not smart anymore. It’s just hope in disguise.
The market doesn’t care about your guesses. It cares about results. Drawing lines beyond real data and calling it analysis is how traders slowly lose money ,then come back here acting like normal rules don’t apply to them.
determinism manifests itself in the shape of the lucky fool, defined as a person who benefited from a disproportionate share of luck but attributes his success to some other, generally very precise, reason.
– Fooled by Randomness (Nassim Taleb)
First, you must know how to distinguish idioms from principles. You can just remember anything from the internet and keep applying it to things which are completely decoupled from that. Clarity is what the market demands, and with the utmost humility I am saying, it comes from pressing the buy-sell button, not by fiddling with fifth-hand knowledge.
Statistical noise 
