The group was to discuss critical issues linked to Satyam's future, such as how to retain clients, assess the fraud and restate its financial accounts, according to media reports.

The company's shares rebounded more than 50 per cent by midday on Monday. Dealers said investor confidence had been boosted by the new government-installed board.

Stocks rose 12.4 rupees, or 51.99 per cent, to 36.25 rupees on the same day the Mumbai stock exchange removed the company from the benchmark 30-share Sensex index in reaction to the billion-dollar accounting scandal.

'Investors are hoping for a leap of faith... a new vision for the firm, but there are several issues which the new board will have to tackle,' said R. Balakrishnan, executive director with Centrum Broking.

The streamlined, three member board - appointed by authorities in an effort to salvage the country's international business image - began meeting at Satyam's headquarters in the IT-hub Hyderabad early Monday.

They replaced Satyam's own interim board of directors who took charge after founder and chairman B. Ramalinga Raju admitted the company?s accounts and assets had been falsified for several years.

The new members are Deepak Parekh, the chairman of private sector housing firm HDFC; C.Achuthan, a former member of regulator Securities and Exchange Board of India; and Kiran Karnik, former president of an IT lobby group.

'We have to let investigations continue, and ensure that operations continue and employee confidence is restored,' Mr Karnik, a former head of National Association of Software and Services companies, told media.

The board is likely to brief the media on Monday evening.

Analysts said the board would have to safeguard existing business and new clients as well as look at potential new owners and auditors for the firm.

Satyam shares were in freefall last week, closing at 23.85 rupees on Friday compared with a value of around 180 rupees before the scandal broke.

'The stock had been battered... there is hope that the new board would help improve fortunes for the company,' said Advait Date, a dealer with brokerage BHH Securities. -- AFP