Institutional Buys Prop Up Satyam

Satyam Computer Services recovered on institutional buying today, after four straight sessions of losses.

The share price of the company was up 3.24 per cent at Rs 258.35 on the Bombay Stock Exchange, recovering from an intra-day low of Rs 247 with more than 1.41 crore shares changing hands. It was the biggest gainer among the Sensex constituents.

The scrip had shed 10.5 per cent to Rs 250.25 on January 28 from Rs 279.15 on January 22. However, volumes had increased to 1.29 crore shares from 86.66 lakh shares in the same period.

Analysts at a local brokerage said the recovery in the scrip is due to renewed buying support at lower levels. According to market buzz, a large US-based brokerage house was said to have been active at the counter.

In the last few sessions, Satyam Computer has been most active in the derivatives segment. This was due to expectations that the company may sell its 52.5 per cent stake in Sify. Earlier, there were reports that AOL Time Warner is negotiating to acquire the stake in Sify.

Meanwhile, Satyam's quarterly results, announced on January 21, outperformed market expectations. For the third quarter ended December 31, 2001, it posted a 36.5 per cent rise in net profit to Rs 119.43 crore compared with Rs 87.50 crore in the previous corresponding period.

Satyam also added 27 new clients, including six Fortune 500 companies, in the third quarter ended December 2001.

During the quarter, the company also initiated steps regarding its subsidiaries. It acquired the software services division of Sify at $6.9 million (around Rs 33.33 crore).

The company invested Rs 2.33 crore in CA Satyam ASP Pvt Ltd. Also, it decided to transfer its entire shareholding in Satyam GE Software Services in favour of GE Pacific Mauritius at around Rs 19.32 crore.