When Kisan Ratilal Choksey participated in the annual general meeting of Madras Cements [Get Quote] Limited in Rajapalayam in interior Tamil Nadu five decades ago, he was one of 15 shareholders at the AGM and the only one coming from 1,500 miles away. "Two company officials came to the railway station to see me off," recalls Choksey.

Incorporated in 1961, Madras Cement is not a favourite stock on the bourses today, but Choksey, 69, says he has earned enough and more from the stock. Choksey's experience with Madras Cements is the story of the enormous change in the India stock market over the past decades.

For starters, the size of the investor base has gone up dramatically. "Even raising a few lakhs was a Herculean task because people did not understand shares as an asset class like we do today," Choksey says.

Most capital investments were funded by borrowings and the equity cult only really took off after the seventies when Dhirubhai Ambani entered with his big bang public offer that laid the foundation for the Indian stock market.

"Dhirubhai had an overwhelming feeling that if investors were not kept happy, he couldn't get more money and that would limit his growth. So he treated investors as family members," says Choksey, who runs his 28-year-old broking firm, K R Choksey Shares and Securities. Reliance Industries [Get Quote] Limited now boasts a shareholder base of over 1.8 million crore investors.

Then, again, from an information scarce world we have an information overload today. Choksey had to wait for a company's annual shareholder meeting to know about its plans and prospects, while today companies have to mandatorily report quarterly financials and material events impacting share price.

"At that time we did not have even telephones, but now we have conference calls organised by companies, and also websites, television channels and pink papers analyse the market threadbare everyday."

As against today's fat research reports, Choksey says he was one of the very few to do one-page reports on companies.

Though the basics of investing were the same, research was constrained by lack of adequate resources. Finance as a science too was still evolving.

"I used to look at the gross block for the past years to see if the company was building capacities to sustain growth, and then see if the price-earnings for the share were justified or not," says Choksey, who started off as a partner in his family-owned M K Choksey & Company in 1961 after acquiring a commerce degree from Mumbai's Poddar College.

It is the faith in fundamentals that helped Choksey and others survive stormy times and grow their businesses.

"I used to study during lean markets and sharpen my skills," adds Choksey who still attends his office in Jeejeebhoy Tower. Being up-to-date is even more important today because very few companies are able to sustain businesses successfully for a length of time due to changes in the economic climate.

Even as unsuccessful companies perish, new companies are added to the list, increasing the choice for investors. Till the eighties, the number of securities traded was less than 400; the IPO boom of the early nineties took this number to around 4,000.

If it was fundamentals for some like Choksey, it was gambling for others. A leading operator in the seventies and eighties, Manu Manek ruled the market till Harshad Mehta came to the forefront.

"Manek was a legendary personality and a powerful operator who dictated the market," says Choksi. Without his nod, it was impossible to become the director of a company. Apparently, on the day of election, he would send the name or list of directors to companies - and only those people ever got elected.

Though everybody appeared aware of this, no charges were ever levied against him. Omnipresent in the stock market, his favourite hunting ground was Indian Iron, which recently merged with SAIL [Get Quote].

Among leading operators in those times were San Bagh Chand for Scindia Steamship Navigator and Sumtilal Jamnalal for Century Mills. Harshad Mehta and Ketan Parekh came much later, in the early and late nineties.

One thing that has not changed though is rampant speculation. Ever since stock trading began some 180 years ago, speculation has been rampant and, after the introduction of badla, there would be speculation on speculation!

"Since positions could be carried forward under badla, members would come to know who is building positions in which counter. Speculators would then bet on the strength and weakness of the operator in the stock. In fact, a number of operators/brokers failed because they accumulated huge positions and finally could not exit from the stock," remembers Choksey.

This was one of the factors the capital market watchdog was investigating during the Ketan Parekh-led scam in 2001, when Anand Rathi, the president of BSE, was charged with misusing his position to support a bear cartel allegedly formed by market operators Shankar Sharma and Nirmal Bang to bring down the bulls of the time. All three were eventually exonerated.

Choksey's business values have not changed in the face of changes in the broking industry.

"It was a royal business with two hours of trading, and a lot of holidays - about 4-5 days for Diwali, a week or 10 days for Christmas, and holidays for festivals and state and central government holidays. Now, you've got to serve clients round the clock, all through the year, and even that's not enough."

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