Satyam effect: Spice Comm stock soars by default

The stock of Spice Communications On Monday zoomed 68.90 per cent to touch Rs 80.65 at the close of trading on the Bombay Stock Exchange (BSE). Analysts attributed the jump to investors mistakenly assuming Spice to be a B K Modi-owned company, while actually Modi’s stake in the company was taken over by Aditya Birla-owned Idea Cellular in July 2008.

At present, 49 per cent stake in Spice Comm is held by Idea Cellular, another 49 per cent by Telecom Malaysia and the rest 2 per cent by public category investors. Modi had recently announced his intention of acquiring 51 per cent stake in the tainted Satyam Computer Services.

“Idea Cellular would like to clarify that Idea had acquired B K Modi Group’s stake in Spice Communications in July 2008. Hence, Spice Communications has no relation with the B K Modi-led Spice group and is not in any way involved with any initiative relating to Satyam,” an Idea Cellular spokesperson said.

The reaction to the stocks of the other suitors for Satyam (stock up 6.57 per cent On Monday), however, was mixed. While the Hinduja Global Solutions — the BPO arm of the Hinduja Group — stock went up by 20 per cent to close at Rs 155.40, the share prices of Tech Mahindra and its parent Mahindra & Mahindra were down by 1.2 per cent and 3.24 per cent respectively. The stock of HCL Technologies dipped 2.24 per cent, while that of Larsen & Toubro (interested in management control of Satyam) fell 3.95 per cent to close at Rs 661.95.