Satyam back on track

Satyam Computer, which was struggling to even meet its January salary bill, now reports a small cash surplus. The company has cleared all its liabilities including salaries and supplier payments, said a top official on the request of anonymity.

The company has managed its operations with collections of over Rs 2,000 crore from customers in the last three months or an average of Rs 700 crore a month, reported Business Line. When Satyam nosedived into deep crisis in January with Ramalinga Raju went public confessing to inflating balance sheet, the company had receivables of a little over Rs 1,700 crore, all of which has been recovered in the period since, said the official.

Satyam spent almost Rs 1,000 crore in March to meet its salary and other obligations pending since January. Almost the entire money was spent from internal accruals over the last three months, leaving it with about Rs 200 crore cash as of April 1.

In February, Satyam was left with surplus cash of over Rs 450 crore after payment of salaries. This included the Rs 300-crore loan it borrowed that month, which it used to repay old loans and also meet forex losses from prior hedging contracts. The company is understood to have been sanctioned a further Rs 385-crore loan from two different banks, which it has not availed itself of yet.

Given the healthy cash situation, Satyam also has reportedly discharged most of its liabilities for pending bills, including supplier and vendor payments, in March. Vendors are understood to have opted to take cash immediately in return for small discounts of up to 10 percent on their pending bills.