Take Satyam Computer (SAY), a global IT consulting firm that helps American companies recruit India's engineers at 1/8 the price an engineer here in the US would ask for.
We absolutely adore this company.
The outsourcing boom has been hitting Satyam's bottom line like a ton of bricks.
Satyam is India's fourth-biggest software services provider, catering to the outsourcing needs of household names like Lehman Brothers (LEH) and General Electric (GE), not to mention 148 other Fortune 500 companies gravitating to India's world class education.
With exponentially increasing revenues, awesome visibility here in the states, and headstrong management to carry the firm forward, Satyam makes a boatload of economic sense for investors looking for a pure outsourcing play.
Satyam recently denied that it was in talks with IBM about a possible buyout, but we think both parties are not telling us everything there is to know.
Big Blue (IBM), the world's largest computer maker, is expanding rapidly in India as a services player.
In any event, India's emerging economy presents myriad opportunities for investors.
Although expectations are sky high and most of these stocks are priced for perfection, the bottom line is that nimbler players like Satyam and Infosys (INFY) are taking on larger projects and winning more lucrative contracts.
We believe that demand for global business solutions out of India will remain robust and we're reiterating our hold rating on shares of Satyam.
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