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RISE AND FALL OF SATYAM

INTRODUCTION
• Satyam Computer was formed in 1987 in Hyderbad, India by B. Ramalinga Raju. • Satyam Computer Services, Ltd. was a rising star in the Indian outsourced IT services industry. • The firm began with 20 employees and grew rapidly as a global business.

CLIENTS .

Manufacturing and diversified industrials. Retail. Public services and education. Energy and utilities. Banking and financial services. . Telecommunications and travel. • Including : – – – – – – – – Aerospace and defense.SECTORS • It offers IT and BPO services spanning various sectors. Life sciences and healthcare.

Investor lost all out faith in the working of the company and dumped the share of the company. In 1991.COMPANY AT GLANCE: On 24th June 1987. Satyam Computer was incorporated as private limited company for providing software development and consultancy services to large corporation. His first major client John Deere. Satyam computer image got severe hit that can never be mended when its promoter accepted in writing to SEBI about the fudging of books of account of the company for showing inflated profit. . What started as humble beginning in 1990`s by the end of the decade catapulted the Satyam Computer into the big league of IT companies in India. The company was promoted by B Rama Raju and B Ramalinga Raju. ‘Humpty Dumpty had a great fall’. Satyam Computers became the first Indian company to provide offshore services. was skeptical about outsourcing to Satyam. Satyam became the fourth largest IT Company. but Raju`s simple extensive management module convinced it. Satyam share price had a free fall on Wednesday and it closed about 80% down from the previous day close price at Rs40.

RISE OF SATYAM .

the worldwide IT services market was estimated at nearly $400 billion.4%. Satyam’s IT services businesses included 13. . IPO oversubscribed 17 times. • By 2003.120 technical associates servicing over 300 customers worldwide.RISE OF SATYAM • 1991: Satyam gets listed on the Bombay Stock Exchange. with an estimated annual compound growth rate of 6. • At that time.

Ltd.STRATEGY • Satyam Computer Services. • Multi‐pronged business growth strategy would be the stated means to grow Satyam and boost shareholder value. embarked on a multi‐pronged business growth strategy. .

• Enhance capabilities. • Global. . • Employee Training. • Service Industry.• Customer Relationships.

• Satyam stock improvement in share price. • Earnings per share similarly grew at a compound annual growth rate of 40%. • The company was a leading star in a global IT marketplace.GROWTH • The company demonstrated an annual compound growth rate of 35% over that period. .

. • September 23: Satyam gets Golden Peacock Award for Corporate Governance and Compliance.Milestone • 2006: Revenues cross $1 billion. Raju becomes Nasscom chairman. • 2007: Raju named Ernst & Young Entrepreneur of the year.

FALL OF SATYAM .

Question raised by E.Shreedharan regarding Hyderabad Metro Project being allocated to Maytas Infra. .Fraud Of Satyam • • • • • Improper Benefits Of Bank Staff. Lack Of Documentation on Invoices. Helped Maytas in getting major contracts. Invested In “Maytas”.

Indian Government. Shareholders.VICTIMS OF FRAUD. Bankers. • • • • • Employees. . Clients.

FACTORS CONTRIBUTING TO FRAUD • • • • • • Greed Of Money Lack Of Transparency. . Audit failures‐ Internal & External. • Weak Independent directors and Audit committee. High interest in maintaining stock prices. Ambitious Corporate Growth. commercial banks. Aggressiveness of investment banks.

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