The Big Bull and the Billion-Dollar Mirage

In the bustling heart of Mumbai during the late 1980s, a man rose from modest beginnings to claim a throne on Dalal Street—the financial capital of India. Born in 1950s in a lower-middle-class Gujarati family, this person was no stranger to hardship. He took odd jobs before finding his calling in finance. He joined a local organization, but his target was something else. He loved the terms bullish & bearish, the Stock Market.

Armed with ambition and a deep understanding of market behavior, he joined a brokerage firm. But Harshad was no ordinary broker. He had a vision—to transform the perception of stock trading in India, and to elevate it from backrooms to boardrooms. And perhaps, to elevate himself along the way.

By 1991, He was being hailed as the “Big Bull,” a stock market messiah whose Midas touch seemed unstoppable. Indian middle-class investors, starved of economic opportunity, clung to his every move, trusting that where he led, prosperity would follow. He was Harshad Mehta.

Harshad Mehta’s brilliance lay not just in picking stocks, but in recognizing systemic flaws in India’s outdated financial architecture. He discovered a vulnerability in the Ready Forward (RF) market—essentially a short-term lending mechanism between banks, backed by government securities.

Here's how he flipped the system on its head:

Banks, operating on trust and slow regulations, issued Bank Receipts (BRs) as proof of holding securities.

Mehta realized he could obtain fake BRs from small banks who lacked scrutiny.

He then used these forged documents to borrow money from large, reputable banks.

With these massive, uncollateralized loans, he poured liquidity into the stock market, driving the prices of a select group of stocks—ACC, Sterlite, Videocon, among othes—into the stratosphere.

One of the most legendary moments?

He boosted ACC’s stock price from ₹200 to ₹9,000, claiming the real value was tied to the replacement cost of setting up similar infrastructure. The public, dazzled by his confidence, followed blindly.

By 1992, Harshad had turned Dalal Street into his personal playground. The BSE Sensex (India’s benchmark stock index) was soaring. His wealth, fame, and charisma made him a regular on magazine covers and in cocktail party conversations.

He bought a sea-facing penthouse, drove Lexus cars, and hosted lavish parties. He played golf with bureaucrats and rubbed shoulders with Bollywood stars. The line between influence and illusion was rapidly vanishing.

The press adored him. The people trusted him. But behind the glittering facade, the foundations were hollow.

Enter Sucheta Dalal, a financial journalist working for The Times of India. She began to question how one man could move markets with such apparent ease.

On April 23, 1992, she broke the story that would unravel the empire: "The Great Bank Scam."

She revealed that Harshad Mehta was manipulating the system using non-existent BRs, and that banks like SBI had advanced him ₹600 crore (roughly $1.2 billion then) without any security.

The revelations hit like a thunderclap. Panic spread through financial circles. The stock market, buoyed by artificial money, began to nosedive.

As investigations intensified, the truth spilled out in torrents:

Mehta had illegally diverted over ₹4,000 crore (~$1.4 billion at the time) from the Indian banking system.

Several banks were caught napping—or complicit.

The State Bank of India, National Housing Bank, and UCO Bank all faced losses that rippled through the system.

Retail investors—thousands of them—were left holding worthless stocks, their life savings vaporized in a matter of weeks.

The BSE Sensex crashed. The credibility of India’s financial institutions stood shattered. And the myth of the Big Bull collapsed under its own weight.

Harshad Mehta was arrested on November 9, 1992, along with his brothers and several associates. The charges were sweeping: criminal conspiracy, cheating, forgery, and violation of banking norms.

He spent months in custody, all while maintaining his innocence. In a sensational press conference, he claimed he had handed ₹1 crore to then-Prime Minister P.V. Narasimha Rao as a political bribe—though this was never conclusively proven.

Meanwhile, the judiciary, regulators, and financial ecosystem went into damage control:

Over 600 civil suits and criminal cases were filed.

SEBI (Securities and Exchange Board of India), a relatively weak regulator until then, was given teeth.

Online and electronic trading was introduced to reduce fraud.

Banks were forced to separate their banking and investment functions.

While out on bail, Harshad continued to fight his legal battles. He even made a brief return to stock trading, though the magic was gone. The bureaucracy and establishment were not supporting him this time. He was beaten by the law law-enforcing agencies.

In December 2001, at the age of just 47, Harshad Mehta died of a sudden cardiac arrest in Thane prison. He left behind a storm of unresolved cases, a mixed legacy, and a cautionary tale for generations.

At the time of his death, he still faced over 27 criminal cases and dozens of civil suits. His family would continue to battle in court for years.

The Harshad Mehta scam was a turning point in India's financial evolution. It taught India some hard truths:

Systems without oversight breed corruption.

Charisma cannot replace caution.

Markets thrive not on promises, but on principles.

But strangely, even in infamy, Harshad Mehta became a symbol—a flawed genius, a bold risk-taker, perhaps even a product of a system that failed to check ambition in time.

His story has since inspired books, web series (Scam 1992, which became a massive hit), and countless debates in business schools and coffee shops alike.

Was Harshad Mehta a crook or a visionary? A victim of systemic failure or the architect of it?

The answer, as with all complex characters in history, lies somewhere in between.

He didn’t invent corruption. He merely exploited its blind spots with flair, confidence, and an unshakable belief in himself. In doing so, he built an empire not of bricks or steel, but of paper, numbers, and borrowed belief.

And when it came crashing down, it reminded an entire nation that greed has a cost, and someone always pays.