Hindenburg, Adani, and Buch: The investigations that shook markets
New Delhi, Jan 16, 2025
Hindenburg's reports revealed major corporate issues, including Adani's $100 billion market loss and other industry investigations. The firm has now announced its closure
When Hindenburg Research released its investigative reports, the financial world held its breath. Known for exposing corporate misdeeds and triggering market upheavals, the firm’s reports often signalled dark days ahead for the companies it targeted.
Today, however, it is Hindenburg Research that took the final bow.
In a surprising announcement, Nate Anderson, the founder of Hindenburg Research, announced on Wednesday that the short-selling firm is shutting down after seven years of groundbreaking and controversial investigations.
“As I’ve shared with family, friends, and our team since late last year, I have made the decision to disband Hindenburg Research,” Anderson wrote in a blog post. “The plan has been to wind up after we finished the pipeline of ideas we were working on. And as of the last Ponzi cases we just completed and are sharing with regulators, that day is today.”
The decision marks the end of an era for a firm that gained global notoriety for its unrelenting scrutiny of high-profile companies. Over the years, Hindenburg’s reports not only moved markets but also influenced regulatory investigations, criminal indictments, and major corporate shake-ups.
Why now?
Anderson attributed the closure to personal reasons rather than any external pressures. “There’s no specific reason for disbanding Hindenburg today,” he said adding, “We’ve achieved a level of success I never expected, and now feels like the right time to move on.”
However, Anderson acknowledged the toll the work had taken on his health and personal life. In his heartfelt post, he apologised to family and friends for the sacrifices made during Hindenburg’s run, adding that he now looks forward to spending more time with loved ones.
Hindenburg shook Adani Group
Hindenburg’s reputation was built on its fearless approach to exposing corporate wrongdoing. The firm became a household name among investors, particularly for its detailed investigations into fraudulent practices and mismanagement.
One of its most explosive reports came in January 2023, when it accused India’s Adani Group of fraud and stock manipulation. The fallout was catastrophic, wiping out over $100 billion in Gautam Adani’s personal wealth and sending the market capitalisation of Adani Group companies plummeting by more than half within weeks.
While Adani stocks later recovered, the Supreme Court of India said that allegations from firms like Hindenburg could not stand as evidence without proper verification. Still, the report left an indelible mark on Adani’s public image.
Hindenburg and Sebi chairperson Madhabi Puri Buch
In August 2024, Hindenburg Research alleged that Sebi chairperson Madhabi Puri Buch and her husband, Dhaval Buch, had financial ties to offshore entities implicated in the Adani money siphoning scandal.
According to the report, whistleblower documents and subsequent investigations revealed that Madhabi and Dhaval Buch opened an account with IPE Plus Fund 1 in Singapore on June 5, 2015. A declaration by a principal at IIFL stated the source of the investment as “salary” and pegged the couple’s net worth at approximately $10 million.
In response, Madhabi Puri Buch and her husband issued a statement rejecting the allegations, labelling them as unfounded and baseless. “We would like to state that we strongly deny the baseless allegations and insinuations made in the report,” the Buchs said. “The same are devoid of any truth. Our life and finances are an open book. All disclosures as required have already been furnished to Sebi over the years,” they said.
Tech and electric vehicles sectors in the crosshairs
Hindenburg also targeted major players in the technology and electric vehicle sectors.
In 2024, the firm’s report on gaming platform Roblox painted a harrowing picture, calling it an “X-rated pedophile hellscape.” The allegations prompted Roblox to roll out new safety measures for parents.
Electric vehicle startups became another frequent focus. In 2020, Hindenburg accused Nikola, a hydrogen-electric truck manufacturer, of fabricating claims about its vehicles. The report triggered a government investigation, which ultimately led to a settlement with the SEC and the founder’s conviction for fraud.
In 2021, Hindenburg targeted Lordstown Motors, claiming the company faked pre-orders for its electric trucks. These claims were later validated by the SEC, resulting in a $25 million fine for misleading investors.
[The Business Standard]
