Reduce NIIT - Citi
Saturday, October 27, 2007NIIT reported revenue of Rs2.7bn (+33% yoy). EBITDA of Rs359m (+50% yoy). Higher taxes and depreciation, and lower equity income from NIIT Tech led to a net profit of Rs212 m (vs. estimate of Rs246m).
Individual business revenue grew 31% yoy (CIR est. 41%), while EBITDA margin of 23.8% was broadly in line. NIIT said that the price hike for career segment courses in non-metros was from Aug, vs. Jun for metros. Organic corporate business had slower revenue growth, while ElementK growth was in-line. The company introduced new courses for the insurance and financial planning segments; these businesses also saw EBITDA breakeven.
Weaker growth for the individual business and the stronger INR is affecting the corporate business.The sum of parts valuation for NIIT is as follows,
- Core Training Business - Rs 100
- ElemntK - Rs 16
- NIIT Tech Stake - Rs 24
- New Business Rs 5
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