Satyam Computer erased its early losses on Tuesday on sustained buying support from institutions.

By 12:28 IST, the scrip of the software major rose by 1.42% to Rs 156.70 on the BSE, recovering from a low of Rs 148.30. A good volume of over 54.88 lakh shares was recorded on the counter. In two sessions, the Satyam Computer scrip rose by 12% from Rs 140 on 17 April 2003. Earlier, in eight sessions between 7 and 17 April 2003, the scrip slipped on concerns over the company's quarterly performance after the dismal results from Wipro and Infosys, shedding 28.3% to Rs 140 from Rs 195.45.

As per market buzz, the early slide in the Satyam Computer scrip was on panic-selling after a US-based brokerage downgraded the company ahead of its results. However, the recovery in the stock was on institutional support. Government of Singapore and Templeton were said to be active buyers of the stock. In contrast, Unit Trust of India offloaded the stock.

Dealers said the buying support for the stock was due to its attractive valuation. There were also rumours that Satyam Computer may not disappoint analysts with its MQ 2003 results. The company will unveil its fourth quarter results on 24 April 2003.

For Q4, analysts expects Satyam Computer to register a rise in net profit of 1.5-6.8% to Rs 117-123 crore on a 15-20% increase in net sales to Rs 527-549 crore.

Analysts, however, warned that Satyam's results may not be an exception. Already, Infosys and Wipro have come out with disappointing results due to the pressure on billing rates. The guidance from Satyam Computer for the current fiscal may be lacklustre, they said.

For the third quarter (ended 31 December 2002), the company had disappointed the market by coming out with numbers even below its 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