The Ascendancy and Decline of Harshad Mehta: India’s Prominent Bull

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 The Ascendancy and Decline of Harshad Mehta: India’s Prominent Bull


Harshad Mehta, commonly known as the "Big Bull" of the Indian stock market, is a figure of considerable controversy and intrigue in the annals of India's financial landscape. His rapid ascent and subsequent downfall during the 1992 securities scandal left a lasting impact on the country's financial framework, leading to extensive reforms.


The Emergence of the Big Bull


Born in 1954, Harshad Mehta was raised in a middle-class household and entered the stock market after a series of various jobs. His keen insight into market mechanisms and bold tactics earned him the moniker of the "Amitabh Bachchan of the Bombay Stock Exchange." Mehta utilized his charm and financial acumen to draw in investments, amassing significant wealth in a remarkably short time.


The 1992 Scandal


Mehta's decline commenced with his manipulation of the banking system. By employing counterfeit bank receipts and engaging in Ready Forward (RF) transactions, he misappropriated funds from banks to artificially inflate stock prices. This led to a peak in the stock market, with shares such as ACC soaring from ₹200 to ₹9,000. However, investigative reporting by Sucheta Dalal in The Times of India brought his deceitful practices to light, revealing a scam estimated at ₹4,000 crores.



The scandal precipitated a stock market crash, diminishing investor wealth and undermining trust in India's financial institutions. Mehta was apprehended and faced multiple charges, but his life concluded tragically in 2001 when he succumbed to a heart attack while incarcerated.


Legacy and Consequences

The Harshad Mehta scandal marked a pivotal moment, resulting in substantial modifications to India's financial regulations:


Enhancing SEBI: The Securities and Exchange Board of India (SEBI) was granted greater authority to oversee and regulate the stock market effectively.
Banking Reforms: More stringent regulations were implemented to monitor interbank transactions and prevent financial misconduct.

Investor Education: The scandal underscored the necessity for due diligence and transparency in investment practices.

This incident also inspired a plethora of books, films, and critical analyses.

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