Raghav Grover
Technoholic. Blogger. MUNer. Need I say anymore?
Satyam Computers
Insider trading
group members
Raghav Grover
Tony JK
Srinidhi Chari
Aditi Verma
Simran Ahuja
Ritika Chauhan
Vishnu Warriar
Shubham Bose
Vikas
What is insider trading?
It is defined as the malpractice wherein trade of a company securities is undertaken by people who by virtue of their work have access to the otherwise non public information which can be crucial for making investment decisions.
So what is the whole fuss about?
- Raju was arrested Andhra Pradesh police on charges of Conspiracy, Breach of Trust, Cheating and falsification of Records.
- He used dummy accounts to trade in Satyam's shares, thus violating Insider Trading Norms.
Title
a BRIEF history
- Satyam Computer Services, founded in 1987 was one of India's most reputed organisations.
- It converted into a Public Joint Stock Company in 1992.
- It was a part of the NIFTY-50 Share Index.
- Ramalinga Raju had grown to be regarded as on of the most influential businessmen.
Understanding the scam
- The balance sheet of September 2008 showed an inflated (non-existent) Cash and Bank balance of Rs. 5040 crore.
- An accrued interest of Rs. 376 Crore which was also non-existent.
- An understated liability of Rs. 1230 crore on account of funds arranged by Raju.
Effect of the scandal
The scandal shocked and effected the whole financial and stock market.
- Satyam recorded the highest single day share-price fall in history, a 77% fall.
- This mean the share price which was around Rs. 544 in mid-2008 went to Rs. 11.50 on 6 January, 2009.
- This also resulted in SENSEX dropping about 7.3% and NIFTY dropping 6.2%
Title
Satyam: Insider trading
By Raghav Grover
