Metal stocks sharply plunged in the second half of July 9, pushing the Nifty Metal index down nearly 2 percent to emerge as the top sectoral loser on the market today.
While the index was hovering in the red since morning, the selling pressure intensified after short seller Viceroy Research issued a report on its parent firm Vedanta Resources (VRL), claiming that the Anil Agarwal-led conglomerate "resembles a Ponzi scheme".
Viceroy Research shorts Vedanta Resources debt, calls it a 'parasite'
The US-headquartered short seller took a short position of VRL’s debt, calling it a "parasite holding company with no significant operations of its own, propped up entirely by cash extracted from its dying host, Vedanta Limited".
Vedanta – Limited ResourcesViceroy is short of Vedanta Resources (PropCo), the heavily indebted parent & majority owner of Vedanta Limited (NSE : VEDL). The group structure is financially unsustainable, operationally compromised, & resembles a Ponzi scheme. $VEDL 1/ pic.twitter.com/U15v9tlnPm
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— Viceroy (@viceroyresearch) July 9, 2025
Anil Agarwal-owned mining conglomerate is systematically draining Vedanta to service its own debt, Viceroy further said. "VRL's actions to meet its short-term obligations directly impair its creditors’ long-term ability to recover their principal, a situation that resembles a Ponzi scheme where Vedanta stakeholders, which include VRL creditors, are the "suckers'," it added.
Vedanta shares crashed over 8 percent after the report was published. The stock has now made some recovery, trading over 3 percent lower at Rs 440 apiece.
Further, the American short seller said that Hindustan Zinc's resources are being "looted"
through related-party deals with promoter-family owned companies and unjustifiable brand fees. "Vedanta's crown jewel may be its biggest liability," it said while speaking about Hindustan Zinc. The shares of the company are currently down nearly 3 percent to trade at Rs 424 apiece.
A perusal of HZL’s brand fee arrangement (2% of revenues) shows that brand fees are often paid in advance on revenue “estimates”, which appear to be consistently over-estimated. This acts as a interest-free line of credit for tens of millions of dollars. $VEDL 15/ pic.twitter.com/IU8ETl0jR8— Viceroy (@viceroyresearch) July 9, 2025
Trump threatens 50% tariff on US imports
Hindustan Copper, which is part of the group, also witnessed significant selling pressure. The shares of the company dropped over 3 percent. This was further buoyed following US President Trump's threat to impose a 50 percent tariff on imported copper soon, leading to a surge in US prices of the metal by more than 12 percent. Hindalco Industries shares were meanwhile down nearly 2 percent to trade at Rs 674 apiece.
"I believe the tariff on copper, we're going to make 50%," the US President told reporters at a White House cabinet meeting. Following this, US Commerce Secretary Howard Lutnick said in an interview with CNBC that the copper tariffs will likely be put in place by the end of July or August 1.
Steel, aluminium not to be part of India-US mini trade deal, says reports
Steel and aluminium stocks meanwhile plummeted amid reports stating that the two metals won’t be part of the mini trade deal which will likely be announced by US and India soon. Without any exemptions, the steel and aluminium companies will face a 50 percent tariff on exports to America.
Tata Steel shares plunged over 2 percent to trade at Rs 158 apiece, while those of Steel Authority of India (SAIL) and National Aluminium Company (NALCO) dropped over 1.5 percent each.
NMDC, JSW Steel and Adani Enterprises shares were trading in the red with marginal losses.
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