Satyam Turmoil

I am sure every one of you would have heard about Satyam and how it is in deep trouble now. As you are aware many of the institutions have sold their shares and don’t wish to risk it but still there are people who are still buying the shares. It was confusing for me, if someone is selling it then who is buying them? What is that they think about the Satyam that makes them feel that it is the right time to buy when every other person just sticks with selling it?

I realized even if the company is not doing all that great, still some people are showing interest in the company. So who are those people who are interested? There are some other IT companies who might be interested to buy out the company because of its clients and other assets. But the fact remains that when Satyam is facing so much music from legal front, which company would be willing to give in and buy that out? It was later obvious that if Government of Andhra Pradesh wants someone to buy Satyam it will surely do it.

It is learnt that L&T bought 4% of shares in a single day in the range of Rs. 10 – Rs. 15. That is a nice move or not, only the time will tell. Similarly it is rumored that other IT companies also have bought shares. The volume of shares traded on the last few days is enormous.

Satyam does have a very good client base. It is known how business does work. The only fact remains that everyone makes a mistake and they don’t get caught. Once they get caught they become bad else they are all good. I don’t think only Satyam is like this, most of the companies do change things in the books else how can one expect the Swiss Banks to be filled with money from India? Everyone does and gets away and some people get caught. Satyam might have or might not have got its client from proper means but they have got it. When they can bribe the World Bank officials I think they can do anything to get the projects. This clearly shows anywhere in the world things happen the way it happens in India – Bribing.

Retail investors: be very far from Satyam. It is not a good sign for you guys to even think about it. There are possibilities that some company might be interested and want to take over it. It might be a good sign, but don’t indulge in fresh buy of shares. For the guys who have shares try to even out and sell it. Hope you get back your investment.

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2 thoughts on “Satyam Turmoil

  1. It is known how business does work out.
    Since if everything goes fine then there would be no issues else it is very bad
    Could you please throw more light on these sir?

  2. Saravanan says:

    @Shashi:

    That was a typo.. I have corrected it.

    Thanks for pointing it out.

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