Why should you buy Sytam now ?

According to BSE/NSE member Dipan Mehta, Satyam Computer Services has come out with a great set of numbers. Mehta says that valuations appear cheap from Satyam’s point of view. He says that the stock is trading at about 15-16 times current year earnings, which is certainly quite attractive.

Excerpts from CNBC – TV18’s exclusive interview with Dipan Mehta:

Q: Do you track technology - any thoughts on Satyam Computer Services, Polaris Software Lab and Sonata Software?

A: I think we are looking forward to good numbers. Other largecap software majors as well as several midcap have continued the trend, which was started by Infosys Technologies, by coming out with splendid results.

So I think this is one sector, where a lot of action is going to take place for the next few weeks and few months. So on the whole this sector looks interesting. These companies, which are expected to announce their results today should be coming out with numbers, which are more or less in line with the other tech majors.

Clearly, the rupee benefit is percolating down to the bottomline and there are certain issues on the cost front in terms of getting resources and the right type of employees. But the industry will eventually be able to get over these issues and problems.

As I recollect from what was spoken in Hexaware Technologies’s analyst meet, that this is perhaps the best time for Indian software companies in terms of the market place in which they are operating. Clearly offshore is mainstream and the environment in which they are operating is excellent and perhaps that has not completely reflected in the stock prices today.