The year 2018 saw the release of the movie Baazaar, the gripping thriller about money, power and the stock market, starring Saif Ali Khan and Radhika Apte. The film did fairly well on box-office, but for people already in the stock market, the story sounded pretty superfluous, if not outright fictional.
The same year saw another stock market story, a real story of a man who went too far away in his limitless ambition and greed. But a very few people know the story.
This is the rags-to-riches story of a man named Harshad Thakkar, a small town guy who came to Mumbai from Gandhidham in Kutch, Gujarat in 1993, and started working as a salesman at his uncle’s lingerie store in Mulund. A few years later, he shifted to an upscale lingerie store in South Mumbai.
After learning the ropes of the game, Thakkar set up his own manufacturing unit in 1999 and launched the loungewear products brand Valentine. The company grew by leaps and bounds and expanded its products portfolio to include lingerie, loungewear, sleepwear, bridal nightwear, honeymoon sets, bathrobes, women innerwear, sportswear, and kids’ loungewear under the brand name Valentine, new branch extensions, and several new brands.
A Massive Stock Crash
His company Ashapura Intimates Fashions Ltd (AIFL) got listed on BSE in 2013 in SME segment and migrated to BSE Main Board on 3rd June, 2015. The same year it went on to list on NSE as well.
The price of the stock rose from its IPO rate of Rs 40 in 2013 to around Rs 500 by December, 2017. The price continued to range between Rs 400 and Rs 500 till September 27, 2018. Then something happened.
On September 28, the stock opened at 426.40, hit a high of 426.45 and closed at a 20% down circuit at 341.75. A total of 4,76,601 shares exchanged hands at an average price of Rs 416.68!
The stock continued to hit lower circuits for many days, continued to trade lower and lower, till it touched a bottom of Rs 10.55 on February 19, 2019. NSE shifted the stock from EQ segment to BE segment on Feb 22, and since, the stock has inched higher to 15.40 as on March 1.
Within a period of 5 months, the company lost market capitalization of Rs 1,000 crores. A whole lot of retail investors lost their money.
A Missing Businessman
On October 2, Harshad Thakkar visited his Dadar office despite it being a public holiday, met a few employees, wrote four different notes addressed to four different people including his family, employees and close friend and later left office premises leaving both the phones switched off. There is no trace of him since.
In the letters written in Gujarati, Thakkar wrote that, “I have given my own house, my savings to save this company, but even after that, now there is nothing left with me except myself. I kept my house on mortgage and tried to save our company. I have already given everything that I have to the company. I have lost everything, I feel I am loser. This company is my life and I have lost everything. I am sorry for these events and I take full responsibility for the same. All my small assets and my shares, also my (insurance) policy to be given to my company. This is my last wish.”
A Mystery Unsolved
He went on to add that, “…few people of share market have tricked our company.”
It is very clear that stock price was being manipulated artificially through a cartel of people, and the cartel broke.
Surprisingly, despite being such a clear cut case of stock price manipulation, and despite massive loss to small investors and other stakeholders, there have been no complaints and no investigation from NSE, BSE or SEBI.
In one of his letters, Harshad Thakkar wrote that, “I have received many calls from lot of people, and I have learnt because of increased distrust in the market, people around me started losing their trust on me.”
Who were these people? A simple answer can be found, if someone cares to check who sold shares on that fateful day of September 28. But will someone care to check?