NIIT LTD

I have 500 NIIT shares@ 69...... What should I do!!! Anyone can guide!!! Please

 

Hold for long time.Good script as recommmended by Mr Porinju of Equity research in this forum

 

Only a longterm bet - seen as one of the beneficiaries of the skill development initiative. I exited thursday/friday post the recent momemtum seen for i think the stock might offer me an opportunity to reenter at lower levels of 70's

 

But i must caveat - i have abt 10% of my portfolio as a floating portfolio and NIIT was part of it. So my action i based on my considerations. You must be guided by yours. I know a couple of these so called value investors are punting on this stock but i try to not get influenced by them. Go by my own convvictions and considerations. Sometimes i loose in the bargain too (share moves up after i have sold) but then dont regret it. So long as i achieved my target on the floating portfolio i am fine

 

NIIT is VERY HOT Stock Now. Porinu says it can become Billion dollar co. The stock is recently recommended by Eldelweiss:

https://www.edelweiss.in/research/NIIT-Ltd--Rebooting,-Reshaping;-Initiating-Coverage/10006561.html

The call of the 'new world' is for a dramatic change in the way human resources are managed. Sans strong engagement and a meaningful work environment, professionals/job seekers will disengage. Corporates, world over, are increasing spending on employee training to reduce capability gaps and increase engagements. NIIT’s Corporate Learning Group (CLG) is superiorly placed to gain from the changing market dynamics in favor of training outsourcing. Back in India, under the new management, NIIT has completely restructured and revitalised its Skill and Career Group (SCG) and its School Learning Group (SLG). This is expected to boost margin performance due to operating leverage benefit kicking in.

Corporate Training is imperative in today’s dynamic world

In today’s dynamic world, employees appear more like customers or partners rather than subordinates. Without strong engagement and a meaningful work environment, people will disengage. Again, Focus on training becomes imperative with the increasing capability gaps across various fields. These factors are leading to the need for greater and more comprehensive training in an organisation. Businesses are responding by investing increasingly in employee development. Global spend on corporate training currently totals US$135bn, and within that USA’s share is US$85bn.

Training Outsourcing is picking up pace

Corporate training is a complex operation. A small group of people is expected to build and deliver a wide range of training. One solution being adopted increasingly by large organisations is to partner with leading corporate training companies, to provide the requisite end-to-end training services. The year 2014, saw a sizeable increase in the average expenditure for training outsourcing in USA. In 2014, US companies spend US$6.1bn on training outsourcing, up by 7% YoY.

NIIT’s CLG is well placed to take advantage of the Corporate Training market dynamics

NIIT is well placed to gain from the changing market dynamics in the corporate training industry. NIIT has been identified as one of the top 20 training companies in the world for eight consecutive years. The company’s CLG business reported 19% CAGR over FY12-15. Going forward, with higher contribution from the managed training services, the CLG business is expected to grow at 15% CAGR over FY15-FY18E and EBITDA margin will likely improve to 13% in FY18E from 11.5% currently.

Skill & Career Group (SCG): Restructuring to create value; Skill India to provide growth

With decrease in entry level training requirement, SCG was under significant pressure over the last few years. Under the new management, NIIT took a decision to launch a comprehensive business transformation programme to get back onto the profitable growth path. Although, the growth of SCG will likely be anemic in near term; we believe that with demand pick-up, the benefit of operating leverage would kick in and operating margin would improve significantly to 8% in FY18E. NIIT, under skill development programme, has committed to train 1cr people across 16 sectors over the next five years and that should aid growth in the SCG business going forward.

Restructuring of School Group (SCG) to drive value

Under the new management, NIIT has also decided to exit from the government and capex driven private school business and focus on IP driven school business to become more asset light and improve return ratios. The company believes that there is a large opportunity in the K-12 market and is also exploring avenues to enter the B2C segment. Going forward, we expect the non-capex driven private school business to grow by 10% over FY15-18E and operating margin would also improve significantly.

 

Thanks guys for kind advice...