Saytam Pop

Every trader knows that stocks like this go out of business or pop mind numbingly, look at General Growth Properties as it teetered on bankruptcy.  But here are some factors in Saytam's favor as opposed to Enron which it is compared to.

1) Minimal debt

2) Cash, just not as much as before

3) Customers

4) Mass fear

5) No California energy short squeeze

6) The family were and are large shareholders and are not running a ponzi scheme like the New Yorkers were.

Another player is going to come in buy the company at a slight premium or possibly a larger one because:

1) For India and its capital markets to save face, bankruptcy, I don't believe is an option.  Because who knows if this activity is spread throughout the Indian corporate structure.

2) Customers want stability, so if someone financially healthier steps into buy then the customers are more likely to stay.

3) I view this more like Constellation Energy when EdF and Berkshire bid on a thriving enterprise.

And just FYI, and am not an angel since I have been long out of this short, recommended shorting it at $28.  I used a point and figure chart and it had beautiful descending highs which screamed to be shorted, but the trick was riding the trend towards the end and that end is now.

And as Joe Granville says, "At these prices its either going out of business or has to bought."