I'm assuming when he says "governments taking a look at" he means like the Indian government and it's more of a Mafia-type "taking a look at" than a serious inquiry with any actual merit. A strongarm type thing
What I've noticed, casually, is that they often target companies or management with a pattern of fraud and abuse, and surprise they keep doing it.
VP of Sales gets slapped on the wrist for illegal tactics?
A few years later he goes on to be promoted to CEO and.... does the same thing!
Amazing.
I wouldn’t be surprised if the sum of it is “has the company been caught doing fraud more than once and haven’t been shut down? They’re still doing fraud”.
Someone who plays fast and loose with the law to get their sales bonus doesn't just find Jesus and give up one day. More likely he gets promoted and does it all over again.
But some of the short seller research I've heard of like interviewing ex-employees about internal irregularities is quite clever.
In another case (I think it was a different short seller) he went to the actual physical locations declared on paperwork as "offices" and found them to be empty warehouses.
So this kind of interviewing and boots on ground stuff is next level.
You can draw your own conclusions but a company worth hundreds of billions of dollars being audited by a mom and pop shop is more evidence than anyone needs that their books are made up.
The fact that the Adani group couldn’t refute any of their claims was pretty telling as well.
https://www.aljazeera.com/economy/2023/3/1/modi-govt-allowed...