The Hindu Business Line : Satyam still has many buyers as it plunges to a new low

Mumbai, Jan. 9 Hyderabad is the cynosure of all eyes and the woes of Satyam Computer Services Ltd are far from over. But, at the dealing rooms of brokerage houses in Mumbai, it was business as usual at the counters, with many cursing their luck for not picking up Satyam stock at Rs 6.30 during trading hours.

Of course, there were an equal number blaming their stars for the misfortune that had befallen them, while offloading whatever their holdings in Satyam were.

Though brokerage houses had washed their hands off the stock on Wednesday, their clientele could not do so as easily with the stock forming a part of their portfolios.

Unaffected were the day traders, chirpy and boisterous as ever, eager to make a quick buck in the falling stock, which hit a momentous low of Rs 6.30, before closing 40 per cent down at Rs 23.75.

It was a war of words at a brokerage house in South Mumbai. A broker chided his client for frequently changing tack, pointing out that he would have netted a sizable margin if only his words were heeded. “See, you did not permit me to buy when it was Rs 6.30, as by now, you would have made a decent margin,” he screamed at the top of his voice over phone.

At the next terminal, a day trader retorted that trading Satyam stocks was foolishness, while trying to gain attention of others all around. Surprisingly, he was punching a buy order for his client.

Though brokerage houses swore on Wednesday evening to keep away from the stock, advice kept flowing in to the dealing rooms - of course, unofficial. Interestingly, many analysts said that they did not hold any view on the stock as the figures furnished thus far had no credibility.

By late evening, many brokerage houses were vociferous in saying that Rs 7,136 crore or no scam, the stock at Rs 6.30 was a steal.

However, the word on the street was that the risks were as not high as the reward and there was still some steam left in the Satyam bogey.

On a sober tone, Mr Ketan Malkan, Vice-President, India Infoline, said the risk reward ratio holds good for a price of Rs 10 or Rs 20 – nothing much to lose and plenty to gain if a revival came about.

“This is the reason why retail investors and largely day traders are putting their money in the stock,” he explained.

Some day traders were more forthcoming: “Woh ab toh bas satta hai, paise banao aur nikal jao (no fundamentals, nothing now, it is just like gambling; just make money and exit).

On the stock exchanges, as high as 30 crore shares changed hands on Friday alone. The deliverable ratio of the stock on the NSE was 27.7 per cent and 21 per cent on the BSE. The difference between the ask and bid price was mostly between five and 20 paise, with orders being executed in seconds.

On Friday, the Satyam scrip opened at the intra-day high of Rs 32, while it fell to a low of Rs 11.50 before closing at Rs 23.85 on the BSE.

The volumes on the BSE were as high as 81 million shares, while on NSE, they were more than 215 million.

On the NSE, the stock opened at the day’s high of Rs 36, while it dropped to a low of Rs 6.30 before closing at Rs 23.75.

While Satyam dragged the Sensex down on Wednesday by seven per cent or over 750 points, the sentiment improved on Friday with the 30 share index gaining 180 points, buoyed by lower inflation numbers.

Related Stories:
Brokerages drop Satyam coverage
Satyam fall: Day traders feel the pinch

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