There are people who want your money.

On the day that Satyam announced its plans to cancel the Maytas buyout, the stock price stabilised around 170 – 180. I was asked on CNBC-TV18 and Awaaz, many times if Satyam was a buying opportunity. My answer was: NO. I think the answer did not please the anchors (except Udayan who understands the markets in India far better than anyone else on business TV). My friends from different funds and brokerage houses were pushing the case for buying Satyam at ‘bargain’ prices. I sounded like a party spoiler.

There are two point here. First, why was Satyam not a buying opportunity ? When the news of the Maytas takeover broke out, Satyam was trading at 220. The news saw it fall to 170 and lower. Once the takeover plans were aborted, things should go back to normal. This means that prices should revert back to 220 (pre-announcement levels) . Therefore, individual traders / investors should be interested in Satyam only after prices reach 220 at which point the stock becomes ‘normal’ once again, and, we have proof that smart money says the stock price should be 220 at least. Since the stock price did not come even close to 220, my advice was consistent – stay away.

Second point refers to the relentless advice received by viewers on TV asking them to buy Satyam at ‘bargain’ because of 100 different reasons. Today, you know that this advice was worse than useless. Anyone who followed this advice has lost a lot of money. I am sure this happens innocently, but the advice has a hidden message – ” give us your money -quick”. Why should you ?