IT firm Mahindra Satyam today tumbled by over 9 per cent in early trade on the BSE, reacting to the company's move to delist from the New York Stock Exchange over its inability to comply with US market norms.
On Friday, the company said it would delist its American Depositary Receipts (ADRs) from the NYSE on October 14, following which its shares plunged by as much as 24 per cent to $4.64 apiece on the NYSE.
ADRs are shares issued by non-American companies to raise money in the US.
The company cited its inability to file restated US-GAAP financial statements for the period ended March 31, 2009, on or prior to October 15, the deadline given by US regulator SEC, as being responsible for the move to delist.
Amid a firm broader market, shares of Mahindra Satyam (earlier known as Satyam Computer Services) started the day on a weak note and tanked by 9.49 per cent to an early low of Rs 90.60 on the Bombay Stock Exchange. The scrip had lost 6 per cent in the previous trading session on Friday.
In a similar fashion, shares of the company nosedived on the National Stock Exchange to Rs 88.10, down 12.07 per cent from the previous close.
Meanwhile, the broader market was trading in positive terrain, registering a gain of 120.10 points to 20,165.28 in the morning session.
Erstwhile Satyam Computer did not file its financial results for 2008-09 and 2009-10 after its founder, B Ramalinga Raju, admitted to an accounting scam running into over Rs 14,000 crore.
The company is slated to come out with its financials for the first time since the scam on September 29.