The early 1990s saw several transformations in India. Economic Liberalization, inflow of foreign direct investments, India catching up with the globalization wave to mention a few. But for someone who know stock market and the Indian finance industry, the name Harshad Mehta is inevitable. Even though, I read bits and pieces on this elsewhere, it was too technical to understand. The Hansal Mehta directed web series- Scam streaming at Sony Liv gives a thorough understanding on the events. Here are some interesting facts that the series explains lucratively.
Humble Beginnings, Success & Failed Attempts
The series begins with Harshad living in a typical Bombay style middle class home at Ghatkopar. Becoming a broker, he shifts with his family to a bigger house in Kandivali. His brother introduces him to someone at Ambalal Stocks. Harshad learns the trade working as a Jobber in the BSE ring and goes on to become a Broker himself. While he emerges successful with his own strategies or we can call it malpractices, a new entrant in the market i.e. Ajay Kedia turns the table around.
This then follows by a massive loss of a million in the 1980s and eventual death of his father. Then comes the idea of starting a consultancy i.e. GrowMore. Despite the initial lull, Mehta does lure more clients in the coming days. Finally, he finds wide success with his stint as an institutional broker and building a wide spread source of cash flow mobilizing PSUs and local Banks. The narrative on his growth is more impressive and understandable for the common man.
Role of Sucheta Dalal, RBI Governor & Bofors Madhavan
Harshad Mehta’s scam is first identified by Sucheta Dalal, the Finance Journalist at Times of India and she goes left, right and centre to create a credible story. Her failed attempts to connect the dots and how she gets onto the spotlight as well is pretty lucrative. RBI Governor Venkitaramanan identifying the discrepancies and calling out Sucheta to make it public is a scrumptious screenplay.
Last but not the least, Bofors Madhavan (CBI Officer) played by Rajat Kapoor grabs the spotlight diligently. His clean record, straight forward nature and his fearless motives to question anyone is appreciable.
Money Markets & Institutional Investments
I remember the time when I was working as an Equity Correspondent. Well, my work was more inclined towards writing news based on press releases. One fine day, I began reading on institutional investments and that turned out to be the last time I read on the topic. In the series, when Harshad Mehta saw an opportunity in earning more as an institutional investments, he approaches Tyagi in Citibank. Unlikely, Tyagi outsmarts him saying there is no place for outsiders in the market. There is much more value in government securities and bonds which the institutional brokers were exploiting largely.
Ajay Kedia, a renowned money market broker during that time approaches Tyagi to say that Harshad has coined a new term to the financial dictionary i.e. Bankerage. Well, this doesn’t go well with both of them and the money market brokers associated with them. During the investigation, the CBI Director does ask Harshad Mehta the same question on Bankerage. I’m not aware of the money market practices, but this term is probably existent in the banking system for very long. Perhaps, this term was new to India with Harshad Mehta. Well, I’m not trying to stir an etymology debate here.
Hansal Mehta has put a simple and straight forward story line that presents the facts in a pretty understandable manner for all. Even though in several instances Harshad Mehta is shown as a Bull fighting the Bears, his misdoings are pretty well emphasized. Overall, one can understand the practices in stock market, money market and the entire financial sector in India to a large extent watching this series.