Satyam scandal rocks markets; Sensex down 749 points

07 January 2009

The multi-thousand crore Satyam scandal that was uncovered early this morning led to a heavy sell-off on the benchmark as well as sectoral indices. The Nifty has broken 2900 mark during the day while the Sensex closed below 10,000 level. B Ramalinga Raju, the outgoing chairman of Satyam, admitted to cooking up figures in the Satyam balance sheet. The abortive Matyas deal last month that brought the company much bad press was also aimed to cover his tracks.

The Satyam scam is the biggest one after Harshad Mehta and Ketan Parekh. This news has hammered the stock a lot, which touched a new 52-week low of 30.80. It has seen a drop of 77.51% to Rs 40.25, at close. There were pending buy orders of 288,984 shares, with no sellers available in the stock. It has traded with volumes of 330,058,513 shares, an increase of 966.06% compared to its 5-day average of 30,960,602 shares.

The benchmark indices took a heavy knock and witnessed a steep cut. The Sensex has touched an intraday low of 9,510.15, before closing the day at 9,586.88, a drop of 749.05 points or 7.25% from previous close. The 50-share NSE Nifty shut shop at 2920.40, down 6.18% or 192.40 points, after hitting a low of 2888.20.

Volumes have seen huge jump in today's trade; total traded turnover was at Rs 80,869.61 crore. This includes Rs 15,494.67 crore from NSE Cash segment, Rs 59,555.20 crore from NSE F&O and the balance Rs 5,819.74 crore from BSE Cash segment.    

BSE IT Index tumbled 218.66 points or 9.32%, to settle 2,128.16, due to free-fall in Satyam. Otherwise, rest of major technology shares witessed a bit of buying interest. Infosys rose 1.67% and Wipro went up just 0.23%. However, TCS fell only about 0.8%. HCL Tech plunged 15.09% and Tech Mahindra fell 14.57%.

Real estate stocks took huge beating in today's trade, Realty Index was down 16.95% or 401 points, to close at 1,965.20. HDIL, Indiabulls Real, Unitech, Puravankara Projects, Ansal Properties, Orbit Corporation, DLF, Parsvnath, Sobha Developer, Mahindra Life and Phoenix Mills lost 10-21.5%.