Harshad Mehta scam to Black Monday: 5 most devastating stock market crashes that crippled BSE, NSE

The mayhem created on Black Monday wiped out Rs 19 lakh crore on stock markets in India in a single session of trading. However, it was not the first time that the share market had suffered such a devastating crash. There are at least five such incidents when the bloodbath on Dalal Street has created such a market mayhem that the BSE and the NSE have lost billions of rupees. 

Harshad Mehta scam crash, 1992

The Bombay Stock Exchange (BSE) witnessed one of the worst falls in 1992 after the infamous Harshad Mehta scam came to the surface and the big bull was arrested. The benchmark Sensex nosedived from 4,467 to around 2,529 by May 1993. Soon, the market began to recover slowly and regain its lost position. The Sensex crossed the 4,600 mark again in 1996 after it regained 82% of its lost points. However, a series of measures like economic reforms, liberalisation policies, increased investor awareness, and the introduction of stronger institutional safeguards buttressed the stock market. 

Ketan Parekh Scam crash, 2001

The stock market crashed once again in September 2001, when the dot-com bubble burst was followed by the Ketan Parekh scam. The BSE benchmark Sensex nosedived from 4,200 points to 2,594 levels from 4,200 levels in September. It took time to recover from the severe blow and the momentum began to build in 2003. The market recovered 62% by mid-2004 when the BSE benchmark index climbed back to around 4,200. A strong growth in the GDP, a boo in the IT sector, and growing global interest in India’s economic potential boosted the overall sentiment that ultimately pushed the market up.

Global Financial Crisis causes crash in 2008

When the Global Financial Crisis hit the world economy in 2008 and brought devastation to the stock markets across the world, the Indian share market too suffered. Coming under the crushing burden of the financial crisis, the Sensex plummeted from 21,000 points to approximately 8,000 points. Besides, the widespread global economic turmoil, the collapse of major financial institutions and a sharp contraction in economic activity were the main contributing factors behind the move.  

COVID-19 crashes stock market in 2020

The outbreak of the pandemic of COVID-19 in March 2020 brought a severe economic crisis too. It drove down the Sensex from 41,000 points to about 25,981 points as global markets reacted to the economic shutdowns and uncertainties. Showing resilience, the stock market recovered quickly after the government injected liquidity and lowered interest rates.

However, the market recovered quickly. The Sensex climbed to 41,000 by November as it recovered 58% of the losses it had suffered. The BSE benchmark scaled past 60,000, representing over a 130% gain. The vaccine optimism, Foreign Institutional Investor (FII) inflows, and a surge in retail investor participation catapulted the market.

Black Monday of April 7, 2025

The US reciprocal tariff regime, as announced by President Donald Trump, proved so detrimental that the Bombay Stock Exchange (BSE) opened with a low of 3,000 points at the benchmark index of Sensex.  

Minutes after opening at 9.16 AM on Monday, the BSE Sensex was recorded at 3,072, or 4.09% lower at 72,296. The NSE index Nifty50 dropped 1,146 points, or 5%, to 21,758. This was not just the result of a panic sale but the broad-based carnage taking place on Dalal Street.