Institutional selling pressured Satyam Computer to a new 52-week low of Rs 187.20 on Monday as techs get thw worst caning over war fears.
By 12:35 IST, the scrip of the Hyderabad-based software major lost 2.97% (from its yesterday's close) to Rs 189.55. It had touched Rs 197.90 earlier for a high today. Over 2.13 million Satyam shares were registered as volumes so far.
Over the last one year, Satyam Computer has lost 36% from its 52-week high of Rs 295.90 on 18 March 2002
As per market rumours, CL Securities was an active seller on the Satyam Counter.
The uncertainty, due to fears of war, is the main cause for Satyam Computer's depression, market men say.
There are rumours, too, that top clients of Satyam Computer have cut IT spending. This, if true, will hurt Satyam's earnings considerably. The software sector is already bearing the brunt of anxiety over war. A war could stymie order inflows from the US, hitting revenues of these companies adversely. The sector receives over 65-75% of its export revenues from the US. Reports that a legislature in the state of Washington may soon consider a bill that could make outsourcing from India difficult, has further raised concerns about future earnings of Indian IT companies.
One analyst says, at the current levels, Satyam looks attractive due to the cheap valuation.
Meanwhile, the Satyam Computer stock's low-key performance is blamed on dismal performance. For the third quarter (ended 31 December 2002) results fell even below the company's own guidance. It posted a 2.2% fall in net profit to Rs 116.73 crore (Rs 1.16 billion) from Rs 119.43 crore (Rs 1.19 billion) in the corresponding period of the previous year. Sales rose by 19.8% to Rs 522.26 crore (Rs 5.22 billion) from Rs 435.77 crore (Rs 4.35 billion). On a sequential basis, the company posted a 5% rise in sales. However, profit after tax (after extraordinary items) slipped by 1% as margins were under pressure.
BSE code: 500376
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