Vedanta to raise funds and reduce its holding in HZL through OFS . OFS is at a discounted price of Rs 486/ share
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Finally GoI begins disinvestment - It to sell 2.5% of its stake in HZL through Offer for Sale at a Floor price of Rs 505
Retail Investor can bid for shares amounting to Rs 2 Lakhs each which translates into a bid of roughly 400 shares per retail Investor
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Between GOI & Promoters, game thus far has been played well, throwing out dividends and jacking up stock price only to announce the OFS at attractive discount.
Barring those who have bought the stock at much lower rates, new entrants in the last 6 months will find cheated by both promoters & GOI to have lured them with dizzying rally.
Though long term still looks good for the stock, the volatility in the stock price is strangely non-correlated to its underlying metal prices.
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High silver price and with geo political tension commodity prices may go up. Hindustan zinc migh be one of beneficial. .need to track copper, silver price and shipmen hlby hindustan zinc
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Unethical promoters never create any value for investors and are detrimental to minority shareholders.
Anil Agrawal once told 87 rupess is full value for vedanta..
Milking dividend from Hind zink to pare their debt.
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Monoply business, the second largest producer of silver, generates approximately 5000 crore in profit from silver operations alone. However, there is no rerating as the promoter does not believe in ethical business practices.
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Absolutely agree with you. Hindustan zinc has been the âcash providerâ for the parent and promoters. The high debt level of the parent just ensures that this will keep going for longer, a really sad fact. Do you see fundamentally hindustan zinc can get better based on the growth project?
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Promoters should allocate funds for growth capital expenditures. They must double their capacity in the next three to five years.
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Guys, what did we say, who ever owns Vedanta should check this report right now! !
The report uncovered material quantitative and qualitative discrepancies in Vedanta groupâs, many of which we believe are tantamount to fraud. Of note:
Bait and Switch Funding Model â Vedanta Limited promotes ludicrous capital-intensive projects that it cannot afford in order to raise fresh capital. This capital is then paid out to the PropCo to service its debt.
Irreconcilable Interest Expenses â Vedantaâs interest expenses vastly exceed its reported note rates, and continues to increase despite paydowns and restructuring.
Inflated Asset Values â We evidence inflated asset values across VEDLâs large list of non-performing operating subsidiaries. The debt across these assets vastly exceeds their true value and is cross collateralized among the Group.
CAPEX Fraud â Expenses across operating subsidiaries are systematically capitalized, artificially inflating profits and asset values. This is a material misrepresentation.
Off-Balance Sheet Items â Billions of dollars of disputed expenses are kept off-balance sheet and undisclosed in financial reports.
Governance Failure â Vedanta presents systematic governance failures across management and auditors, including inappropriate auditor choices.
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All these were known to investors already
There is nothing new in this report that people didnt already knew
The information was already priced in
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I have quickly gone through the whole report, obviously there are more to uncover than we knew before!
VEDL and its subsidiaries have paid $1.16 billion over four years to VRL in so-called âbrand feesâ and âstrategic servicesâ. But this parent company acutually have no London staff, itâs an empty office! And there is no operational input not to mention any strategic service.
These payments function as rolling, prepaid advances, designed to bypass dividend payouts to minority shareholders, including the Government of India. Just think about it, who else pay this high amount of brand fee? Not even giants like Tata
This is an obvious arbitrage.
Be patient and read the whole thing then make your decision
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since this comes from a short seller with a vested interest in the outcome and a firm whom no one has heard of, itâs going to take a while to be believed. Besides most of the info is already known.
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Now everyone knows them. But yeah, I never heard of them either. Viceroy for Vedanta is the Hindenburg for Adani. Currently the market is not reacting to it dramatically, but if you check the historical drops of Adani, you will see the biggest market reaction was a week after Hindenburgâs attack. That was a terrifying 55% drop. I wonât bear that risk, and financially I can never.
And as you said, many info is already known, then why no one is responsible for this? Why these problems were never solved? Also if you read the whole thing, you may say something different. This report may be a good opportunity to draw more attention, and can help stop promoters from exploiting money from poor minority shareholders including us retail investors! Thatâs a positive side Iâm seeing.
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most of the data put out was already known and itâs not minority shareholder friendly over many years. the firm being in debt etc. this time people may sit it out and not get goosed into panic selling like they did on Adani
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Economic Times has a dedicated article on this now, and this explained who is Viceroy. Iâm convinced that they do have enough evidence to prove themselves right. I trust them more than Vedanta promoters.
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I am aware of the unethical business practices surrounding the merger of Crain India with Vedanta. Crain India had 25000 crore in cash from mutual fund investments, but after the merger, these investments were wiped out. Following the depletion of these funds, they are now planning to demerge Crain India from Vedanta.
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Hi, Do you know about the brand fee before?
My belief of Vedanta now is actually collapsing. I had some hopes in it and was genuinely expecting some proper response from them about the report during the AGM. But wellâŚ
I was checking the recordings, how can they skip the question about the brand fee the report kept talking about. No response about 1.16billion USD paid, which could have come to us shareholders. Itâs apparently a deliberate silence.
Also, here is a good interview explaining the whole thing:
I have no idea on the brand fee and I donât see it as an issue. the markets also seem to have brushed off this with the share price increasing across vedanta companies. and theyâre still going ahead with a breakup into 6 companies.
All in all, no one seems to be doing anything so far.
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Silver prices at an all time high and trending better than gold prices, silver price is upwards of Rs 110,000 and also influencing the stock price of HZL favourably.
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