The latest Hindenburg Research has sparked several debates and allegations against Sebi Chief Madhabi Puri Buch and her husband, Dhaval Buch, claiming that they were involved in the offshore entities tied to the Adani Group’s alleged money siphoning activities. 

The Hindenburg’s reports further also claimed that both Madhabi Buch and her husband had stakes in obscure Bermuda and Mauritius funds, which are raising concerns about conflicts of interest. 

However, these allegations were denied by Buch and the Adani Group, categorically involving any wrongdoing.  

Notably, this Hindenburg Research has targeted numerous companies worldwide since its interception. Some of the most high-profile cases, by this research involves the electric truck maker, Nkola Corp, accusation of Adani Group in financial misconduct and stock manipulation in January 2023, Clover Health and many more. 

What exactly is this Hindenburg Research? 

Founded in 2017, by Nathan Anderson, Hindenburg Research is specialized in conducting forensic financial research and publishes reports on companies, after investigating their business and conduct in the market. Their research often highlights the scandals, problems and issues going on in these companies. These scandals and misconduct also include irregularities, mismanagement and undisclosed transactions.  

Typically, they made their own capital investments in carrying out the investigations by betting against the companies and alleged their wrong doings after publishing the report. 

Nikola Corp: the hype gaining research by Hindenburg in 2020 

The Hindenburg Research gained significant attention and hype with its published report on Nikola Corporation back in September 2020. In the published report, Nikola has been accused of fraud and misleading the investors about its technology and capabilities. This led to a decline in Nikola’s stocks, along with serious accusations of scrutiny from regulators.  

As per the reports, Nikola’s founder and CEO, Trevor Milton was convicted of fraud and later had to pay a sum of $125 million for settlement to the U.S. Securities and Exchange Commission. 

Since then, Hindenburg has continued to release some high-profile reports on companies and make major revelations on their business conduct. 

How does Hindenburg make profit? 

In an article published back in 2023, by Marl Humphery-Jenner, there are various explained strategies used by Hindenburg and similar firms to make profit from short selling.  

The lucrative strategies include research and investigation on frauds, misconduct, internal documents and conducting interviews to gather more suspected data. 

Short selling, here it means, that before releasing their report, Hindenburg take short positions by taking shares of the company and selling them at current market price with the intension of buying them back at lower price. 

Further, Hindenburg publishes a detailed report, outlining their findings against the company and making profit from the decline.