Vedanta’s proposal to acquire bankrupt Jaiprakash Associates Ltd (JAL) poses financial risk to the Indian government, which holds stakes in its units Hindustan Zinc Limited (HZL) and Bharat Aluminium Co. (Balco), according to US-based shortseller Viceroy Research. Acquiring JAL will be an “unviable” transaction for Vedanta, said Viceroy in a letter to the Department of Investment and Public Asset Management on September 19. Viceroy estimated JAL would generate a free cash flow shortfall of more than Rs 18,600 crore over five years, leaving Vedanta dependent on extracting money from its most profitable units. A Vedanta spokesperson for declined to comment. Lenders to JAL have extended the date of submission of revised plans, with updated offers, till September 25. Bidders are expected to disclose the source of funding along with their proposed resolution plans, sources said. A committee of creditors will assess revised plans next week. HZL and Balco accounted for 42 per cent of Vedanta’s free cash flow in FY25, but contributed only 31 per cent of the revenue, the letter said.
