Just a day after Satyam Computer Services announced impressive results for the quarter ended June, shareholders at the company's 16th annual general meeting today expressed concern over the decline in company's intangible assets in the last fiscal.

Some shareholders expressed deep concern over the destroyed shareholder wealth, which got reflected in the economic value added for the company.

The points raised by some of the shareholders seem to have caught the attention of the company's new directors, Krishna Palepu and Vinod K Dham, who were attending the company's AGM for the first time.

Satyam's brand value, for the year ended March 2003, got eroded by 15.5 per cent to Rs 2,705 crore (Rs 27.05 billion) from Rs 3,200 crore (Rs 32 billion) in the previous fiscal.

The company's EVA, which measures the profitability of the company after taking into account the cost of all capital including equity, has fallen sharply by 45 per cent to Rs 93.75 crore (Rs 937.5 million) compared with the Rs 170.11 crore (Rs 1.701 billion) for the year ended March 2002.

EVA is the residual income after charging the company for the cost of capital provided by lenders and shareholders.

It represents the value added to the shareholders' wealth by generating operating profits in excess of cost of capital employed in the business.

It is those companies which earn higher returns than cost of capital that create value and those companies that earn lower returns than cost of capital are deemed destroyers of shareholders' value.

The company's travel expenses and personnel expenditure are increasing substantially, Ranga Rao, a shareholder expressed his concern.

Personnel expenses to software revenues ratio has gone up to 48.45 per cent from 45.56 per cent in the previous year. Net operating profit after tax has declined to Rs 460.6 crore (Rs 4.606 billion) from Rs 499.72 crore (Rs 4.997 billion), he put forth his analysis before the audience.

"Last fiscal, you have provided a huge sum for writing off some of your investments. What should the shareholders expect in the current fiscal, few more provisions?," another shareholder asked the management.

Satyam provided Rs 33.61 crore (Rs 336.1 million) towards diminution in value of investments and Rs 152.45 crore (Rs 1.524 billion) towards writing off of investments in subsidiaries last fiscal. But some shareholders have praised the management for taking the company to new heights.