Bears vs Bulls: Harshad Mehta rip-off to COVID-19—Prime 7 largest inventory market crashes in India’s historical past

Inventory market crash: The Indian inventory market faces the warmth of home and world triggers after extending its shedding streak for the third consecutive week and reaching its lowest ranges since June 2024. Home benchmarks, Sensex and Nifty 50, logged their worst day in round 5 months, with the NSE benchmark posting its longest month-to-month shedding streak within the final 29 years (since 1996), dragged by overseas capital outflows amid US tariff fears.

Nonetheless, promoting strain from exterior triggers is nothing new for the Indian inventory market. Historical past tells us that the frontline indices have confronted far worse crashes within the final 30 years. From enduring the brunt of large banking scams to world financial slowdowns, Sensex and Nifty 50 have witnessed corrections, recoveries, and stellar highs, pushed by the resilience of home buyers amid India’s robust macroeconomic fundamentals. 

Additionally Learn: Inventory market crash: Nifty logs longest month-to-month shedding streak in 29 years; What ought to be your buying and selling technique?

In response to D-Road analysts, India’s long-term progress story has supported the inventory market sentiment. Corrections and breathers are commonest after logging file highs. The BSE benchmark is down 14.86 per cent from its peak of 85,978.25 on September 27, not too way back. Coming to historic knowledge, let’s check out the highest seven largest inventory market crashes in India’s historical past:

Prime 7 largest inventory market crashes in India’s monetary market historical past

1.Harshad Mehta Rip-off (1992)

The inventory market crash was triggered by the Harshad Mehta securities rip-off when the stockbroker manipulated inventory costs utilizing fraudulent funds. The Sensex shed 56 per cent from its final peak, falling from 4,467 in April 1992 to 1,980 by April 1993. The crash took practically two years to stabilise. 
 

2.Asian Monetary Disaster (1997)

The market crash was attributable to regional foreign money collapses, which gripped a lot of East and Southeast Asia throughout the late Nineties. In December 1997, the Sensex barometer plunged over 28 per cent from 4,600 to three,300. It took one yr for the inventory market to recuperate and log new highs.

Additionally Learn: Nifty 50, Sensex undergo largest intraday drop of 2025; IT shares hit onerous—10 key highlights
 

3.Dot-com Bubble Burst (2000)
The collapse of the tech bubble prompted the inventory market crash in 2000, earlier than the flip of the century. The Sensex slumped from 5,937 in February 2000 to three,404 in October 2001, shedding 43 per cent. The inventory market recovered steadily after buyers shifted focus from tech to different sectors.
 

4.Election Shock (2004)
The sudden victory of the UPA coalition in 2004 prompted panic amongst buyers. Sensex dropped 15 per cent intraday on Might 17, 2004, triggering a buying and selling halt resulting from overselling available in the market. Nonetheless, the benchmark index recovered from the intraday election shock throughout the subsequent 2-3 weeks.
 

5.International Monetary Disaster (2008)
Lehman Brothers’ collapse within the US and the subprime mortgage disaster triggered a worldwide recession. The Sensex dropped over 60 per cent from its peak of 21,206 in January 2008 to eight,160 by October 2008. The federal government’s stimulus measures and world liquidity helped a rebound by 2009.

Additionally Learn: Markets in freefall: Nifty 50, Sensex down 16% from peak as world commerce tensions escalate
 

6.International Slowdown (2015-2016)
China’s market crash, commodity worth crash, and home non-performing property (NPAs) prompted the inventory market crash. The Sensex shed 24 per cent, from 30,000 in January 2015 to 22,951 in February 2016. Regardless of the crash, the Sensex recovered inside 12-14 months amid India’s financial resilience.

7.COVID-19 Crash (March 2020)
Worldwide lockdowns and financial uncertainty attributable to the COVID-19 pandemic prompted the inventory market crash in March 2020. The Sensex misplaced 39 per cent, falling from 42,273 in January 2020 to 25,638 in March 2020. The federal government’s aggressive fiscal and financial insurance policies led to a V-shaped restoration by late 2020, regardless of the financial system hitting technical recession.

Disclaimer: The views and suggestions offered on this evaluation are these of particular person analysts or broking firms, not Mint. We strongly advise buyers to seek the advice of with licensed specialists, think about particular person threat tolerance, and conduct thorough analysis earlier than making funding choices, as market situations can change quickly, and particular person circumstances might differ.