Satyam Computer could not hold fort on Wednesday as a pre-results fervour ended in disdain as most marketmen expect the company to post weak numbers.

As a result the scroip of the tech pivotal took a bow, down 2.9% to Rs 154.15, on BSE in mid-afternoon trades. Volatile trading marked Satyam's descent from the higher levels. The stock had gained 2.2% to Rs 162.30 earlier. 3.6 million Satyam Computer shares changed hands on BSE on Wednesday. The volumes were low compared to the about 10 million shares on each day of the last two trading sessions.

On Tuesday, too, the stock experienced volatility. But even so, it had rallied from a 52-week low of Rs 144.20 on 17 April 2003. The stock surged 10% in two trading sessions to Rs 158.70 on 22 April 2003.

The slide on the counter today comes due to cautiousness ahead of results. Satyam Computer's financial performance in Q4 is likely to be poor. For the fourth quarter, analysts expect SCSL to report a net profit of about Rs 116 crore (Rs 1.16 billion) – which is a slight fall sequentially. They expect an about 2% sequential growth in net sales to Rs 535 crore (Rs 5.35 billion).

Satyam Computer's margins have been under pressure as the company's marketing efforts have been intensified. Besides, ramp-up by top clients remains sluggish, according to IT analysts.

However, market men do not rule out a positive surprise from Satyam Computer. There have been rumours that the company may not disappoint analysts this time round.

For the third quarter (ended 31 December 2002), the company had disappointed the market by coming out with numbers even below its own guidance. It posted a 2.2% fall in net profit to Rs 116.73 crore (Rs 1.16 billion) from Rs 119.43 crore (Rs 1.19 billion) in the corresponding period of the previous year. Sales rose by 19.8% to Rs 522.26 crore (Rs 5.22 billion) from Rs 435.77 crore (Rs 4.35 billion). On a sequential basis, the company posted a 5% rise in sales. However, profit after tax (after extraordinary items) slipped by 1% sequentially as margins were under pressure. The management had attributed this dismal performance to lower-than-anticipated ramp-up in revenue from a few customers and an expected large deal, which was to result in a multi-million dollar revenue in each of the quarters, being put on hold.

The poor results prompted Satyam Computer to revise downwards its revenue and earning per share guidance for FY 2002-03 to Rs 2,010- Rs 2,020 crore (Rs 20.1-20.2 billion) and Rs 14.57-14.66 crore respectively. This was the second straight time that the company revised downwards its EPS forecast for the full year.

At the time of announcing Q2 (ended 30 September 2002) results, Satyam Computer had revised downward its FY 2002-03 EPS guidance to Rs 16.06-16.26, from an earlier forecast of Rs 17.10-Rs 17.50. It had cited a stronger rupee and the resultant fall in other income for the revision.

General Electric is Satyam Computer's largest client but analysts said the growth of the company's business from GE remains muted.

BSE code: 500376