NIIT Technologies Ltd (NIITT) –Buy- Kotak Securities
Our recent interaction with the NIIT Technologies Ltd (NIITT) reflected management’s increased optimism on the future prospects of the company. While client budgets are almost flat for CY10, the off-shore component is increasing.
This has resulted in increased wallet share for Indian vendors in client budgets. While existing clients are scaling up, new clients are driving growth in APAC region. NIITT received a Rs2.28 billion 5-year order from BSF in India. ROOM revenues are also picking up with new clients having been added.
Non-linear initiatives are gaining traction – order for COSYS IS implementation is a case in point. Employee additions continue, indicating higher business visibility. We maintain FY11 EPS estimates at Rs23.8 and price target at Rs230. Re-iterate BUY.
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