Ketan Parekh rigged K-10 stocks and crashed the Indian market

Ketan Parekh was a Mumbai-based stockbroker and chartered accountant who had worked at Harshad Mehta's firm GrowMore Investments. From late 1998 to 2001, he orchestrated a massive stock market manipulation scheme. Parekh purchased small stakes in lesser-known, low-market-capitalization companies — informally called 'K-10 stocks' — and inflated their prices through circular trading with other traders and collusion with company promoters.

To fund the manipulation, Parekh borrowed enormous sums from Madhavpura Mercantile Co-operative Bank, where he served as a director. Zee Telefilms rose from ₹127 to ₹10,000, Visualsoft from ₹625 to ₹8,448, and Sonata Software from ₹90 to ₹2,936. After the March 2001 Union Budget, the Sensex crashed 176 points. The RBI refused to clear Parekh's pay orders, finding them suspicious. A bear cartel of opposing brokers dumped their K-10 holdings, and Parekh panic-sold his entire position at the Calcutta Stock Exchange after hours.

The resulting crash caused large-scale losses for institutional investors including insurance companies and mutual funds. Madhavpura Mercantile Co-operative Bank collapsed. Parekh was arrested in March 2001, convicted in 2008 and 2014, and banned from trading for 14 years. A 30-member Joint Parliamentary Committee investigated the scandal. In 2025, SEBI banned Parekh again for a front-running scam and impounded ₹66 crore.