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COVER STORY: THE STOCK SCAM; SMALL INVESTORS
Rajeev Maheshwari, 40, a
PSU employee from Delhi, has weathered three scams but is still going
on. Rajeev Maheshwari still manages to
smile, crack a joke and talk normally. Of course, he has lost money, lots
of it (let's not talk numbers he says), but after 15 years of stock trading
and three stock scams later, he has become hardened. His enthusiasm, or
rather his addiction, is intact. "It's in my blood. Once you get
in you cannot come out," he says. As for the losses, he says, "If
the holding capacity is good, one can tide over this crisis."
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"I've
filed cases against promoters and SEBI."
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Like many others, Maheshwari too invested on
the advice of friends, the media and his own gut feel. Cheated by companies
and trapped by the system, he has slapped cases on promoters, the SEBI,
the Department of Company Affairs, even the Government of India. "I
know nothing will come out of it but I'll get mental peace," he admits.
-Malini Goyal
Suryakant Doshi, 47,
a Mumbai trader, lost Rs 2 lakh in media and software shares.
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"I have lost heavily
in the stock market.
But who do I blame and what's the point?"
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Suryakant Doshi
is a typical Indian investor who believes in the kinetics of Karma. In
the past three months Doshi has obsessively watched his wealth being eroded
by over Rs 2 lakh. Drawn by the bullish fervour Doshi cocked his ears
to market whispers, read analyst reports, watched business channels on
TV and invested in many public issues including favourites like Cinevista
(which was issued at Rs 300 and is now quoting Rs 40) and Geometric Solutions
(which was priced at Rs 300 and is currently quoting at Rs 69). Doshi
also bought shares in the secondary market: Hinduja Finance at Rs 425,
Zee Telefilms at Rs 1,200 and SSI at Rs 2,200. He admits that the loss
has made him think again but feels drawn to the high of the stock market.
"Perhaps it is the lure of the returns," he says.
In the cloth bazaar there is little business
and returns are aren't much to write home about. Besides it hasn't been
the best years for dealers and entrepreneurs in the old economy. Like
many of his friends, Doshi also decided to park some of his savings in
the share market in the hope that the returns would make up for the dip
in business.
Except this time round he found part of his
capital wiped out. Asked again about his losses, Doshi says with an air
of resignation, "It could be more. But who will I blame and what
is the point." Perhaps.
-V. Shankar Aiyar
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"Why
didn't they probe the bull run? What's the point of an inquiry when
prices are crashing?"
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Nirav Shah, 30, a businessman
from Mumbai took the advice of TV analysts seriously and lost over
Rs 5 lakh in the ICE meltdown during the past year.
He has this innocent look about him. A commerce
graduate, Nirav Shah, who works in the family's materials handling business,
has just finished calculating his loss in the stock market. The toll:
over Rs 5 lakh of hard-earned money that he had saved while working in
Dubai.
Among the scrips he bought: Zee Telefilms at
Rs 1,000, Hughes Software at Rs 1,950 and SSI at Rs 2,700. All ice favourites.
Like many others, Shah too was bitten by the TV channel bug. "I used
to be glued to the television and believed whatever the analysts said.
I never thought that ice would melt," he says.
Whenever he met friends, the talk revolved around
who had made how much in which scrip. But the gains were almost always
notional because nobody wanted to sell. However, much to their dismay,
the losses that they have piled up are for real.
Shah, who got married recently, had planned
to go on an overseas holiday this summer. But now that has been postponed
"till the next bull run" and his "dream of buying a new
Santro" has been shelved.
Today, Shah feels totally let down by the regulators.
"Why didn't they probe the bull run? What is the point in ordering
a probe when prices are crashing? It's like locking the stable after the
horses have bolted." It's a question thousands of small investors
like him are asking.
-V. Shankar Aiyar
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