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The legendary bear operator Manu Manek needs no introduction. The Cobra of Dalal Street was famous for the short-selling of stocks and running the powerful bear cartel which led to the temporary closure of the Bombay Stock Exchange in the 1980s. 

If you have already watched the new SonyLiv web series "Scam 1992", you have an idea of who the Cobra was and how he got his famous nickname. 

For those of you who haven't had the pleasure of watching this web series, let me start from the beginning.


As kids, it was common to associate power with flowing capes, bat-mobiles and Kryptonite. It was synonymous with muscles or fast cars or the ability to command armies and nuclear weaponry. In other words, power was something tangible. Little did we know that real power is rarely that conspicuous.  

Scam 1992 brought to light the intricacies involved in the manipulation of the market and the sheer power and authority that these individuals commanded. Akin to puppet masters, they worked behind the scenes and the rest of the market danced to their tunes. The character Manu Mundra, played by Satish Kaushik, is based on the Cobra - Manu Manek.

To introduce Manu Manek, let us resort to the words of Kisan Ratilal Choksey, the founder of K R Choksey Shares and Securities. 

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

This will give you an idea as to the authority and presence that the Cobra commanded over the market and its participants. 

Manu Manek's reputation was far-reaching and his influence, omnipresent. Back in the 1980s, nothing happened on Dalal Street without his nod or knowledge. He was the unofficial king of the Bombay Stock Exchange, and the companies and the network of stockbrokers were his subjects. All paid homage to the Cobra and feared his power.

Manu Manek has even been associated with other prominent investors that we know and love. "Bulls, Bears and Other Beasts" by Santosh Nair contains references to the Big Bull Rakesh Jhunjhunwala as well as the founder of DMart, Radhakishan Damani. 

According to Economic Times, "Radhakishan Damani, then in his late-20s, would stand at the far end of the raucous trading ring and watch the Cobra in action. It is evident that young Damani learnt a lot watching crafty Manek spoiling the bulls' party."


The question that arises is, how did Manu Manek manipulate the market?

How did the Cobra become the Cobra?

In order to understand that, let us first understand what short-selling and a bear position is.

Now, the most common strategy of investing in the stock market is to buy shares of companies when the price is low, wait for the company to perform well and for the stock price to increase, and then sell off the shares at the higher price. This gives rise to capital gains.

This source of profit originates from the growth and the improved market position of the company. Such investment strategies are called bullish strategies. They are based on the premise that the stock market will improve and the share prices of companies will increase. 

This is called taking a long position in the stock.

The other strategy is based on a more pessimistic outlook. 

Here, investors look for companies that have already been inflated, and there is an imminent fall. These strategies are called bearish strategies and are based on the premise that the share price will fall in the future. The idea is to take a short position in the company when the share price is high, wait for the price to fall, and then cash in the profits.


Now the question that arises here is, how can you short sell shares?

There are two options. If you want to short a stock that you already knew, all you have to do is sell the share at the high price, wait for the price to drop, and then buy back the share again at the low price. In this case, the difference in price is profit.

The other option, if you want to short a stock that you do not own, is to do it on leverage. Here, there are two methods. First, you can make use of derivatives and buy a put option on that stock. Alternatively, you can ask your stock broker to lend you the shares. However, this is only going to be possible if you have a long-standing credible relationship with your broker.

The latter strategy is what brought Manu Manek to fame and also what gave him the nickname of Cobra.

Now the reason why Manu Manek was a 'perpetual bear' had little to do with his personal philosophies and life principles. It was more because of the conditions prevailing in the stock market during those times and the fact that it was practically impossible to get access to low-cost credit.

Back in the 1980s, it was common practice to pay 20-30% interest on the credit taken to buy shares. In order to adopt bullish positions, traders would use this extremely expensive credit and launch a buying frenzy.

The stock price would therefore increase on the back of the increased demand.  

All this time, the Cobra would wait, coiled up and ready to strike. 

Once the stock price crescendoed, Manu Manek would enter the market. He would keep shorting the stock over the next couple of days, and increase selling pressure in the market. As the supply of the stock in the market keeps increasing, the price of that stock falls.

As a result, the bullish traders would lose out on all their money, and the Cobra would make a killing (figuratively, of course). 

According to Sevantilal Shah of Stewart and Company, "He (Manu Manek) had the natural gift of being able to detect any hollowness in the market".

There is an important point to mention here. 

Manu Manek was not alone in his short-selling strategies. There was an entire bear cartel that followed Manek's directions and mirrored his moves in the stock market.

You see, in order to actually sway the market in any particular direction, the size of the position that has to be adopted is gigantic. Now, of course, it is possible for a single person to adopt a position of such proportions, but there is more strength in numbers.

Manu Manek, too, was aware of the same, and over the years, he formed a bear cartel. This bear cartel followed the same ideologies, and they struck along with the Cobra. 


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There are several instances when Harshad Mehta's path crossed with that of Manu Manek. 

Let me tell you about one such time when the Bull and the Bear locked horns.

The bone of contention, in this case, was a company called Indrol.

Manu Manek, as always, had adopted a short position in this stock. Harshad Mehta was on the other side of the court, with a long position. 

Harshad Mehta kept increasing the buying pressure in this stock and forced the bears to scramble for cover. As a last resort, the Cobra spread a rumour that Mehta had lost an amount of Rs. 1 crore in the stock market. This was done to attack the Mehta's credibility.

But, Harshad Mehta was the one who had the last laugh in this case. He cleared all his dues and emerged as victorious in the battle.



In the early 1980s, Reliance Industries was booming. This was partly due to the consistent performance of the company, and partly due to the fact that Dhirubhai Ambani kept his shareholders' best interests at heart.

According to Choksey, "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."

That is until the Cobra set his sights on Reliance.

The fearless Manu Manek had realised the magnitude of the profit that the bear cartel would be able to generate if they were able to implement the short-selling strategy successfully. 

Thus they entered the market and started short-selling with a vengeance. Large quantities of Reliance shares were short-sold consistently to bring down the price. The bear cartel's intention was to bring the flood the market with Reliance shares and increase the supply several-fold. They expected that the share price would tumble as a result. They sold the shares at a high price with the intention of buying it back again when the price fell. In this way, they planned to rake in the profits.

However as it turns out, the Cobra had underestimated Dhirubhai Ambani.

Ambani was not one to surrender to such an attack and let his company's stock price crash. He deployed his lieutenant Anand Jain to lead the defence.

Anand Jain was able to turn the defensive position into a counter-attack, and along with his associates, he essentially went after the bear cartel.

To counter the selling pressure, Anand Jain and his associates started buying up the shares that Manu Manek and his associates were selling. The more the bear cartel sold, the more Anand Jain bought. In this way, he was able to regenerate the demand for Reliance shares in the market.

As a result of the continued buying pressure, the share price of Reliance started to rise again. 

What was even more troubling for the bear cartel was the fact that much of the short positions that they had adopted were leveraged in nature. This means the short-sellers did not actually own the stocks. They had intended to buy the shares when the price fell.

Anand Jain and the bulls were now in a position to checkmate the bears. Amidst the intense buying pressure, they insisted that the bears deliver the actual shares. 

The bears now had no other choice. Either they would have to buy back whatever shares were still available at the inflated price or wait a little longer and allow the price to rise even higher.

This standoff actually caused the Bombay Stock Exchange to close down for a few days.

After that, Manu Manek and the bear cartel waved the white flag of surrender and paid their dues to Anand Jain and Dhirubhai Ambani.

Thus the indomitable that is Reliance, continued its march towards glory.


Thus concludes the story of the Cobra. A skilled and shrewd trader, he and the "rhythmic swish-swash of his starched dhoti and Jaipuri mojari" were well-known across Dalal Street. 

If you want to know more about the story of Harshad Mehta and the review of Scam 1992, visit our YouTube channel.

Please share this blog among your friends and family, so that they, too, may know the story of the great Cobra of Dalal Street.


Begin your investing journey today, by creating a free demat account with Upstox, India's fastest growing brokerage platform. Register here to get started.


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