Mahindra Satyam — scarred by India’s biggest corporate fraud in its previous avatar — is awash in red ink but there is a sign of hope in profitability.
Audited, restated results released for the first time 22 months after the scandal broke out reported a Rs 124.6-crore net loss for the year ended March 2010. While there are miles to go in recovery, the management looked confident in Hyderabad as they unveiled the numbers on Wednesday.
The number of employees in the company has come down to 27,000 from 45,000 when the scam broke out, and clients are down to 350 from 500.
In its first results show after B. Ramalinga Raju, founder chairman of Satyam Computer Services, admitted to fraud in January, 2009, Mahindra Satyam — renamed after a takeover by Tech Mahindra — reported a revenue of R5,481 crore in 2009-10.
But the margin for earnings before interest, depreciation, taxation and amortisation, an indicator of core profitability, was a positive 8.3 per cent. The firm has a cash chest of R2,177 crore.
The fraud amount is placed at R7,855 crore. “The cash infused is still there is a good news along with a strong employee base that will support the future growth,” said Gaurav Dua, head of research at Sharekhan, who expected the stock to go up.