Hold Mahindra Satyam Stock

September 23, 2010 | In: Stocks Analysis

Mahindra Satyam has jumped from the levels of 80 to 106 in short span of time. It is trading with heavy volumes, 16 crores yesterday and almost 10 crores today. These are just predicting the interest people are taking into the stock. The run up that we saw are all pre results run up. Positive results expectations are building up among people and so everyone wants to get into the company at these undervalued levels. Several people like me are building up long positions on the stock because if I see from a long term view, only sky is the limit for the stock.

The kind of momentum that we have seen building up on the stock is only indicating that the stock will continue to rally and make new highs in near future. Like I said the other day, since Mahindra has taken so much time to announce the results, I’m sure it is going to be very positive. And if the results are really as positive as we expect, we will see a sharp upwards movement right from the day of results.

Today, we saw some sort of profit booking and the stock ended up in the red. My advise is to NOT PANIC, and continue to HOLD the stock. I am giving targets of 150+ for Mahindra Satyam in short term. Continue to hold the stock, you will make huge profits here.

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http://www.rediffmail.com Vijay

Hi Mayank, Really found some interesting stuff on your blog….can you please suggest some good banking stocks to buy..??
Mayank

Banking stocks have run up so much lately that I find it risky to put money at current levels. If markets fall, banks will fall a lot. However I do like Yes Bank and ICICI Bank, so if they correct, you can buy.
http://www.rediffmail.com Vijay

Thanks for your prompt reply…..one ques, why satyam is falling daily…isnt it indicating that recently hoopla has been made around by the traders to book profits on the dead bodies of retail invrestots? i also think that it will fall drastically….ur comments please?
Mayank

Yeah, it seems people started securing their profits. I’m sure there were people who bought from levels of 80, they must be securing their profits. Plus many are shorting believing the stock will be back to lower levels where they can re enter. And the rally was news driven, on the back of positive results hope, so profit booking move isn’t a lot of surprise.

I’d keep a stop loss of 95/97 and hold the stock. I think it should go up again next week because of the results on Wednesday. Plus the merge ratio is also going to be announced soon, we’ll get a clear picture on Wednesday about the future of the stock.
Raju

Now that the stock is going to fall, should I really hold it or sell it? I’m confused, please help
Mayank

If you are short term trader, perhaps exit tomorrow and see if stock falls a lot, buy again? Or if you are long term investor, then continue to hold and forget.
Karthick

I have read all the comments for the stock Satyam, Now the results have published.
Now Suggest me whether i can buy satyam share and hold them for 2 years.
Mayank

If you want to invest into Satyam, you might want to wait for FY11 Q1 and Q2 results and the merge ratio. Ratio can be 1:8 or 1:10 also, we dont know what and how will the Mahindra group evaluate both companies and decide the merge ratio. However Tech Mahindra will nevertheless benefit and since both companies will merge, I’ll suggest to buy Tech Mahindra shares rather Satyam. Tech Mahindra will prove more beneficial I think.
Karthick

Right now i am holding 1100 share in RPower. @ the rate of 175. I am planning to hold this stocks for 3 years . Kindly suggest me whether it is a good stocks. or can i switch into someother stock.
Mayank

No no no! Reliance Power, you’re sitting on a gold mine! But you have to forget it for years. Like you said 3 years, expect amazing returns from Rpower. The company is not likely to perform in the short term because their plants are not ready but when the first plant starts operating and profits starts to roll, it will change everything for the stock price. The stock will jump like anything. I assume in 2012, you will see what kind of profits you’re sitting on. This is a company worth holding till 2020, Rpower plans to make 35,000 MW by 2020, the company that’ll serve you profits all the time, let the first plant get ready.
Karthick

Thanks Mayank… Can i invest in Coal India Lmt IPO. since there is a huge expectation many people are planning to purchase during IPO itself. some people are telling that when hitting the market it will raise 50% of what they bought in IPO Price . kindly suggest me whether can i invest in coal india IPO . And also kindly tell me someother stocks for good investment for long term like RPower.
Mayank

Yes! 100% worth investing into Coal India and pick the upper band limit when investing because you can expect a huge over subscription on CIL and so most who will choose the highest price will get picked and get the shares. Expectations are huge and it might just go up like mad on the day of listing. I’m sure many others who miss it will try to buy it on the day of listing. To get the better of it, try to apply for IPO on various family names, so each member gets something

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