Hindenburg Research, the US-based activist short seller famous for its damning report on the Adani Group has now published a cryptic post on X teasing another potential disclosure involving India.
‘Something big soon India,’ Hindenburg Research wrote in its post on X.
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Who is Hindenburg Research?
Hindenburg Research LLC, founded in 2017 by Nathan Anderson, is a US-based investment research and short selling firm that publishes reports, exposing frauds or corruption in companies, after taking a short position on the company’s stocks.
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The company became famous for its report titled, ‘Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History,’ which led to one of India’s largest conglomerates losing around $86 billion in market capitalisation.
What was the Adani-Hindenburg saga?
Hindenburg’s report on the Adani Group alleged that the conglomerate was involved in stock manipulation and fraud, inflating its share prices more than they were worth.
The report came two days before a $2.5 billion public offering by Adani Enterprises. Adani Enterprises had repeatedly denied all the allegations published in the report.
What happened between Hindenburg Research and SEBI?
The Securities and Exchange Board of India (SEBI) revealed in June earlier this year, that Hindenburg Research had shared an advance copy of its Adani report with New York hedge fund manager Mark Kingdon, two months before it was published.
The short seller dismissed SEBI’s allegations and a notice that claimed the firm violated Indian regulations as “nonsense,” adding that it was “concocted to serve a pre-ordained purpose: an attempt to silence and intimidate those who expose corruption and fraud perpetrated by the most powerful individuals in India.”
Hindenburg also named Kotak Mahindra Bank in the report.
In July, Mahesh Jethmalani, a senior lawyer and BJP leader alleged that a Kingdon had Chinese links and had commissioned the report.
What is short selling?
Short selling is when an investor foresees a fall in the value of a company’s share and therefore, enters into a short selling arrangement with a broker where the investor borrows shares of the company and sells it at the prevailing market prices, then buys shares of the same company after the share price falls and returns the shares.
The investors make a profit from the difference between the market price of the share before it fell and after it fell.
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