Satyam Computers announcement to acquire two related promoter companies [Maytas Properties + Maytas Infrastructure] and final decision to drop this plan, have bought to light the company's earnings growth prospects.
Investors around the world America and India punished Satyam Computers management for valuing the Maytas companies at $1.6bn while they are not even worth $400 mn by dumping the stock of Satyam Computers which dropped by 35% in a single day in India and over 50% in New York.
The real question is who valued these property companies at 4 times the valuation ? the moral of the story is Investors don't like companies which don't have a business model and capacity to generate positive cash flow QoQ. Wait for beginning of Feb-2009 and you will see how banks will pressurise Realty developers to liquidate.
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