PRESENTATION ON INDIA’S ENRON SATYAM SCAM Presented by:- Nitin Gupta MBA, Sem-II

CONTENTS MANAGEMENT INTRODUCTION HOW ITS HAPPENED WHAT WENT WRONG? IMPACT ON INDIAN IT INDUSTRY INDIA’S STEP TO SAVE SATYAM WHO WILL ACQUIRE?

MANAGEMENT

INTRODUCTION

HOW ITS HAPPENED

WHAT WENT WRONG?

IMPACT ON INDIAN IT INDUSTRY

INDIA’S STEP TO SAVE SATYAM

WHO WILL ACQUIRE?

MANAGEMENT FOUNDER : Mr. Raju Ramalinga CEO : Mr. A. S. Murthy

FOUNDER : Mr. Raju Ramalinga

CEO : Mr. A. S. Murthy

Satyam was established in 1987. 4 th fastest growing IT company in India. 9 % market share 40,000 employees Revenue $2.1 billion It is the first company of India listed in three International Exchanges i.e. NYSE, DOW and EURONEXT INTRODUCTION

Satyam was established in 1987.

4 th fastest growing IT company in India.

9 % market share

40,000 employees

Revenue $2.1 billion

It is the first company of India listed in three International Exchanges i.e. NYSE, DOW and EURONEXT

HOW IT’S HAPPENED Maytas Acquisition. Investors Aborted. Board Members Resigned. On 7 th Jan., 09, Chairman resigned after announced involvement in fraud.

Maytas Acquisition.

Investors Aborted.

Board Members Resigned.

On 7 th Jan., 09, Chairman resigned after announced involvement in fraud.

WHAT WENT WRONG? Inflated figures for cash and bank balances of INR 5,040 cr. (as against INR 5,361 crore reflected in the books). Operating Profit were artificially boosted from the actual 61 cr. to 649 cr. Satyam also showed an interest earning of Rs. 376 cr. that was fictitious. Satyam development center

Inflated figures for cash and bank balances of INR 5,040 cr. (as against INR 5,361 crore reflected in the books).

Operating Profit were artificially boosted from the actual 61 cr. to 649 cr.

Satyam also showed an interest earning of

Rs. 376 cr. that was fictitious.

IMPACT ON INDIAN IT INDUSTRY It is surely going to be more difficult for other Indian IT service players to win business. Undoubtedly, this is going to hurt the prospects of foreign money flowing into India. Global perception about indian companies. Indian stock market slipped over 7% on 7 th Jan., 09.

It is surely going to be more difficult for other Indian IT service players to win business.

Undoubtedly, this is going to hurt the prospects of foreign money flowing into India.

Global perception about indian companies.

Indian stock market slipped over 7% on 7 th Jan., 09.

INDIA’S STEP TO SAVE SATYAM The Indian Government has stated that it may provide temporary direct or indirect liquidity support to the company Govt. has appointed new board of members for Satyam consisting of heavy weights from India's corporate sector. Satyam is seeking bank loans to help cover salaries and other operating expenses

The Indian Government has stated that it may provide temporary direct or indirect liquidity support to the company

Govt. has appointed new board of members for Satyam consisting of heavy weights from India's corporate sector.

Satyam is seeking bank loans to help cover salaries and other operating expenses

WHO WILL ACQUIRE?