Exit Patni Computer around Rs 430- 440: Tulsian

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Exit Patni Computer around Rs 430- 440: Tulsian

SP Tulsian of sptulsian.com advices investor to exit from Patni Computer around Rs 430- 440, if one is holding position in it.

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Excerpts from Closing Bell on CNBC-TV18 Watch the full show » ALSO READ See previous views by SP Tulsian See what other Experts & Brokerages are saying about Patni Computer See messages about Patni Computer

SP Tulsian of sptulsian.com advices investor to exit from Patni Computer around Rs 430- 440, if one is holding position in it. 

Tulsian told CNBC-TV18, "In Patni Computer price this is more or less on the expected line and in fact this kind of news was expected probably by the year end that is by December, but the management has already hinted and they have said that process is likely to get completed by April or maybe the middle of 2012. The disappointment is only on the floor price which is non-relevant. In fact I heard management saying that they have allocated a certain amount which translates into a value per share at about Rs 440- 445 and they may not find it interesting to acquire the share above those rates."

He further added, "In fact Mr. Phaneesh Murthy has said that probably he is looking for a rate southward of Rs 450 which I think that more of his wish or maybe just a strategy to influence the retail investors and all sorts of things. I don't think that at those kinds of valuations shares are really going to get acquired by them. But yes if you see the 81% stake of the effective equity held by the promoters and 19% of that 19% about 9% is held by the FIIs. So suppose if some homework or some kind of persuasion is made with the institutional investors and if they are convinced that Rs 450 which in my view is unlikely. Otherwise the fair price is seemed to be at about Rs 500 because management have acquired from the Patni's in the month of April at Rs 504. So there is no reason for the stock to see a value of less than that. So let's wait for the reverse book building process go get initiated and start which will take about three months time. So in the interim period I will advise that those who are holding the stock can exit at about Rs 430-440."

"I really don't see stock moving beyond Rs 435-450 and maybe once this euphoria dies down maybe in next week or so then probably the stock will languish in the range of maybe about Rs 450 and Rs 420 and when the reverse book building process will start again the interest will come back into the stock. But I am taking a call in the price to get discovered in the reverse book building close to around Rs 475."