From Satyam’s site (Awards section):

As for the Golden Peacock Global Award for Corporate Governance:

This is the only award, which has meticulously defined and transparent selection criteria and is determined by highly elaborate and independent assessment process.

Umm, who are the past winners? Here are some ‘interesting’ awardees: HCC, DLF, ICICI Bank, …

Such irony. And unfortunately, Satyam means ‘Truth’ in Sanskrit.

satyam shares Hotness: Volcanic

Related searches:
satyam, satyam merger, satyam in news, sensex, satyam latest news

Peak:
2 hours ago

Location:
26% - Chennai, TN
21% - Bangalore, KA
15% - Hyderabad, AP

Oh how I wish I owned some put options on Satyam Computers today. Look at this at-the-money (strike price = 180) January put on Satyam:

Almost a 10-fold return within a day! I don’t even want to look at the out-of-the-money puts.

OK, I could not resist. The January 120 put went from a low of Rs 1 to a high of Rs 99. That is a 99x return in a day. The lot size is 600, so we are talking a profit of almost Rs 60000 per lot. Oh my god!

DNA: Satyam staff urged to buy 100 shares each via informal advisory by ‘seniors’

Sources among employees said there was an informal email advisory on December 31 from “seniors” asking staff to buy at least 100 shares each to “have more stake in deciding the leadership of the organisation”.

Satyam officials denied sending any such advisory to DNA Money, but sources said employees — they are called ‘associates’ — did buy shares on January 1 and 2 at prices between Rs 120 and Rs 160.

If there’s any truth to this, god help the ’seniors’ who ’suggested’ Satyam employees to go long Satyam at 160.

To mark the day that Satyam Computers, a Nifty-50 index constituent, crashed ~ 75%, and with a turnover greater than that of the next 4 index stocks combined:

And counting . . .

Well, Satyam’s off to an interesting start for 2009:

In a letter to the board of directors, Raju states that Satyam’s balance sheet as on Sep 30, 2008, carries an inflated (non-existent) cash and bank balances of Rs 5,040 crore (as against Rs 5,361 reflected in the books).

Further, it carries an accrued interest of Rs 376 crore which is non-existent. An understated liability of Rs 1,230 crore on account of funds arranged by me. An over stated debtors position of Rs 490 crore (as against Rs 2,651 crore in the books).

For the second quarter ended Sep 30, 2008, the company reported a revenue of Rs 2,700 crore and an operating margin of Rs 649 crore (24% of revenues) as against the actual revenues of Rs 2,112 crore and an actual operating margin of Rs 61 crore (3% of revenues). This has resulted in artificial cash and bank balances going up by Rs 588 crore in the second quarter alone.

At one point, the stock was down almost 70% (from 180 to 54.65) earlier today. Since it’s an F&O-able stock, there is no lower circuit. With Udayan calling for a single-digit stock price, Satyam share-holders are in for a ride of a lifetime.

Let’s get one thing clear: Satyam’s management, board of directors, bankers & auditors deserve to go to jail. There is no need to believe that these illustrious folks were unaware of the rampant inflation of profits & cash over a period of several years. They went along with the farce, signed off on all sorts of legal documents and effectively duped share-holders. Put them in jail!

But the larger point is that this is just the tip of the iceberg. A canary in the coal mine. A sign of rot in the financial core of corporations. It would be naive to think that this is a one-off case. It’s more of a case of ‘you are a thief only if you get caught’.

The question now is: Who else has been doing this to such a large extent & will get caught with their pants down? Looks like 2009 will turn out to be the Year of The BSBS (Balance Sheet Bull Sh!t) for Indian markets.

Some candidates: A private bank, A real estate / infrastructure firm and A metals/commodities company.

Clusterstock: Bernie Madoff’s Victims: The List (live)

“I’m wiped out,” said Sandra Manzke, Maxam’s founder and chairman. The Darien, Conn., fund of hedge funds will have to close as a result of the losses, she said.

“Some investors in Madoff’s funds face 100% write-downs on the money they invested, they will suddenly be nursing full write-downs in December. When people realize the magnitude of this it will be fizzing around the stratosphere.”

Richard Spring.  WSJ: A Boca Raton resident and former securities analyst, says he had about $11 million — or 95% of his net worth — invested with Mr. Madoff. “That’s how much I believed in him,” Mr. Spring said.

Nomura and Neue Privat Bank. “Marketed access to Fairfield Sentry Ltd., a fund overseen by Mr. Madoff and sold through Fairfield Greenwich. The shares offered by Neue Privat and Nomura were leveraged three times — meaning $3 of borrowed money was added to every $1 of capital invested in order to magnify returns, greatly increasing the potential losses for those investors.”

Well, we should be glad we aren’t rich enough to run across folks like Madoff.

Bloomberg: Lehman to Sell French Unit to Nomura for 1 Euro

Lehman Brothers Holdings Inc., the bank selling assets to pay creditors in the biggest U.S. bankruptcy, asked a judge to approve the disposal of a French investment-banking unit for 1 euro ($1.30).

Banque Nomura France, a unit of Tokyo-based Nomura Holdings Inc., was the only bidder for the unit, which has equity capital of 33.5 million euros, Lehman said today in filings in U.S. Bankruptcy Court in New York. In exchange for assuming unspecified liabilities, Nomura will gain employees, commercial records, information technology, furniture and other assets

Would love to look at the Excel spreadsheet that was used to derive this valuation.

NSE Press Room

Financial Technologies (India) Limited, one of the vendors empanelled by NSE to provide CTCL solutions to its Members, has issued a Public Notice in The Economic Times of Friday, the 5th December, 2008 edition levelling various false, baseless and fabricated allegations against NSE under the garb of clarifying press reports quoted therein and the Legal Notice issued by FTIL to NSE. NSE has, through its Solicitors, responded suitably to the Legal Notice received from the Solicitors of FTIL. 

TED Spread, via Bloomberg:

US Treasury Yield Curve, via Yahoo Finance:

Yet another credit squeeze.