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Hindenburg Research, a U.S. short seller, said it made $4.1 million from profits made by its clients shorting Adani securities. That would barely break even, considering the cost of producing research, the firm said, adding, “We made a total profit of approximately $4.1 million from the Adani short position on that investor relationship.” The firm also made about $31,000 from its own short position in Adani’s U.S. bonds, a small stake.
“Excluding legal and research costs (including time, salaries/compensation, and the cost of a two-year global investigation), we would be ahead of break-even on a short-term Adani buy,” he said.
The blog highlighted that previous media reports had suggested that Hindenburg had multiple investor partners who had earned hundreds of millions of dollars. However, SEBI’s show cause notice clarified that Hindenburg had only one investor relationship with the Adani paper, which is consistent with the company’s typical approach.
Despite the financial results that could break even after accounting for legal and research costs, Hindenburg stressed that his work at Adani remains the most rewarding. The blog noted that while the research was not financially justified and involved significant personal risk, it remains the work they are most proud of.
“But our work on Adani is the work we are most proud of to date,” he said. “The incentive is clear: the benefits of fraudulent activity outweigh the small risk of a ‘slap on the wrist’ fine from regulators. And based on the hundreds of tips and leads we have received since the Adani report, Adani is by no means the only latent and persistent problem Sebi has failed to address.”
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