ESL
Essilor International
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Vedanta has come under serious fire recently, after a report by US-based short seller Viceroy Research accused the company of running what looks like a Ponzi scheme. That’s a big allegation, and naturally, investors are shaken. But is it really that bad? Or is it just poor planning and mismanagement at the top?
The Main Allegations are:
* Vedanta Resources Ltd (VRL), the parent company, has no operations of its own. It survives by taking money from its cash-generating subsidiary Vedanta Ltd (VEDL).
* VEDL is allegedly being forced to borrow more money, cut into reserves, and pay out large dividends just to keep VRL afloat.
* There are claims of inflated asset values, expenses shown as assets, and hidden liabilities, all of which make the books look better than they are.
* One example is ESL Steel, where around 30% of claimed capex may have gone to land purchases linked to environmental violations, but was still shown as a productive investment.
Some of these problems sound more like bad financial decisions than outright fraud. Over-relying on debt, taking from subsidiaries, or being too aggressive with dividends can ruin a company even without illegal activity. The company has denied all allegations, calling the Viceroy report “baseless” and misleading.

Vedanta has come under serious fire recently, after a report by US-based short seller Viceroy Research accused the company of running what looks like a Ponzi scheme. That’s a big allegation, and naturally, investors are shaken. But is it really that bad? Or is it just poor planning and mismanagement at the top?
The Main Allegations are:
* Vedanta Resources Ltd (VRL), the parent company, has no operations of its own. It survives by taking money from its cash-generating subsidiary Vedanta Ltd (VEDL).
* VEDL is allegedly being forced to borrow more money, cut into reserves, and pay out large dividends just to keep VRL afloat.
* There are claims of inflated asset values, expenses shown as assets, and hidden liabilities, all of which make the books look better than they are.
* One example is ESL Steel, where around 30% of claimed capex may have gone to land purchases linked to environmental violations, but was still shown as a productive investment.
Some of these problems sound more like bad financial decisions than outright fraud. Over-relying on debt, taking from subsidiaries, or being too aggressive with dividends can ruin a company even without illegal activity. The company has denied all allegations, calling the Viceroy report “baseless” and misleading.