Satyam Computer was up 3.95% at Rs 173.50 on BSE.
Meanwhile, the BSE Sensex was up 25.27 points, or 0.25%, to 10303.55.
On BSE, 1.12 lakh shares were traded in the Tech Mahindra counter. The scrip had an average daily volume of 45,740 shares in the past one quarter.
The stock hit a high of Rs 325 and a low of Rs 287.90 so far during the day. The stock had a 52-week high of Rs 1135 on 7 January 2008 and a 52-week low of Rs 216.10 on 26 November 2008.
The stock had underperformed the market over the past one month till 5 January 2009, rising 12.47% as compared to the Sensex's 14.62% rise. It had also underperformed the market in the past one quarter, falling 54.36% as compared to the Sensex's fall of 17.97%.
The mid-cap telecom software maker has an equity capital of Rs 121.73 crore. Face value per share is Rs 10.
The current price of Rs 310 discounts its Q2 September 2008 annualised EPS of Rs 97.28, by a PE multiple of 3.18.
Tech Mahindra is reported to have approached Satyam Computer Services, India's fourth-largest software exporter by sales, for an all-share merger. If the transaction goes through, the merged entity will be the third -largest IT company in the country in terms of revenue.
The management control of the merged entity will be in the hands of Mahindra & Mahindra (M&M), which owns 48.97% in Tech Mahindra. A senior executive of M&M was quoted by a newspaper report as saying that anything that offers strategic value to Tech Mahindra would be of interest to the group. However, the official refused to comment on whether specific talks had been initiated with Satyam. Report further suggested that M&M is reportedly in touch with Merrill Lynch for the merger.
Talks of a management change at Satyam have been doing the rounds since mid-December 2008, following its botched attempt to take over two infrastructure companies owned by the family of Satyam's founder Ramalinga Raju.
Report added that for the merger to happen, in addition to Mr Raju who now owns around 4.5% in Satyam, some large institutional investors will also have to agree to Tech Mahindra's proposal. Institutional investors and mutual funds together own 61% of Satyam. The big investors in Satyam - Aberdeen, ICICI Prudential, Lazard and Fidelity - together own 13.16% in the company.
Tech Mahindra's net profit rose 16.4% to Rs 295.98 crore on a 3.75% to Rs 1142.04 in Q2 September 2008 over Q1 June 2008. The jump in profit was partly aided by a tax refund of Rs 60 crore from the UK government.
Tech Mahindra provides IT services and solutions to the telecom sector. It provides a variety of services ranging from IT strategy and consulting to system integration, design, application development, implementation, maintenance and product engineering.