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India’s stock market has seen many major shocks in the last three decades, including the Harshad Mehta scam, the Ketan Parekh crash, the global financial meltdown of 2008, the Covid crash of 2020 and the impact of the Adani report of 2023. These five incidents caused huge losses to investors and brought the market to its knees again and again. Every time the market has shown that no matter how strong the rally is, one shock can bring it down in a moment. These crises made investors understand the importance of risk management, patience and long-term thinking and also showed that uncertainty is always associated with profits in the market.
New Delhi. India’s stock market has always been like a roller coaster. Sometimes it makes people rich overnight and sometimes it makes them fall to the ground at the same speed. There have been many times when the decline in the market broke the back of investors and their portfolio did not get a chance to recover not for months but for years.
In the last three decades, some incidents happened which shook the market and made it clear to the people that the stock market is a place of risk as well as profit. These accidents not only changed the history of the market but also influenced the thinking of investors, government policies and regulation framework. Let us know about those five biggest shocks which brought the Indian stock market to its knees again and again.
Harshad Mehta Scam and 1992 Crash
The crash of 1992 was the first major hit to the Indian market which gave a sudden shock to millions of investors. After the bursting of Harshad Mehta scam, blue chip stocks also broke into pieces in the market and an atmosphere of complete chaos was created in the market. This crash made people understand for the first time how sensitive the market is and how even a managed rally can collapse in a moment.
Ketan Parekh Crash 2001
In 2001, the tremendous boom in tech and media stocks suddenly collapsed when Ketan Parekh’s network was caught. The shock in the market caused huge losses to new investors and many stocks fell by 60 to 80 percent. This crash also woke up the regulators and many reforms in the market started after this.
global financial crisis 2008
The fall of 2008 was a big blow to the Indian market along with the entire world. The Sensex fell from 21000 to around 8000 and more than half of investors’ portfolios dried up. This crisis clearly told the Indian investors that the ups and downs of the global market directly impact the Indian market and without preparation, investment can turn into huge losses.
covid crash 2020
In March 2020, Coronavirus caused the Indian stock market to crash like never before. Within a few days, the market fell by thousands of points and almost every sector collapsed. This crash taught investors a strong lesson about the dangers of panic selling and that is why when the market recovered later, the thinking of investors had also changed a lot.
Adani Group report shock 2023
A report in the beginning of 2023 shook the entire stock portfolio of Adani Group. Within a few days, billions of dollars were wiped off the value of companies and retail investors suffered huge losses. This shock was not limited to just one group but also affected the market sentiment and even the index started slipping.
