NIIT Technologies

The software business of NIIT Ltd was spun off as NIIT Technologies (NTL) in 2004. Over the years, the company has enhanced its presence in some segments including Application Development & Management and Enterprise Solutions including Managed Services and BPO. In short, NTL has acquired a global presence.

 

NTL operates in three primary segments, BFSI (adds 43% to its revenues), travel, transportation & logistics (28%) and retail & distribution (13%). In the latest quarter (Q2FY2010), it saw profits rise by 153 per cent QoQ (-11.21% YoY) to Rs 26.06 crore, on the back of better operating numbers. It added 51 new clients in the quarter, and has next year's executable order book worth $105 million (approximately Rs 525 crore). This is likely to go a long way in ensuring ample revenue visibility for the company in the coming quarters.

 

The institutional stake in the company has increased from 13.12 per cent to 19.73 per cent over the last two quarters, while at the same time, the funds that have bet on it have exactly doubled to 20, as it stands at the end of October, 2009. With a dividend of more than 4.12 per cent, and after a market rally of 125 per cent this year so far (till November, 27, 2009), the stock is worth a second look. It is currently trading at 14.20 times its trailing four quarters EPS of Rs 11.56, which is 66.86 per cent higher than its own 3-year median P/E.