India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
NIIT Technologies – Growing in confidence
We met management of NIIT Tech recently. Traction in BFSI (42% of revenues), Asia Pacific
(29% of revenues) and GIS (7% of revenues) should help easily scale our FY12F US$
revenue growth of 16% (ex-hardware). Site consolidation and bulge mix should provide
partial relief from wage pressures in FY12, in our view.
Medium-term business traction in BFSI to be driven by:
growth in its large BFS and Insurance accounts, which should be driven by geographical
expansion and demand for risk management solutions;
an anticipated uptake in the ROOM solutions business (10% of service revenues), where
management believes clients are ready to spend on migrating to the new IPF3 platform;
and
recent entry into two large US-based BFSI accounts, which have long term mining
potential.
Asia Pacific growth to be driven by managed services and GIS
Management is seeing traction in large deals in the managed services space in APAC,
where it has been invited to bid for 3 RFPs in the US$25m range.
The cloud computing tie-up with Hitachi Systems, which was unveiled last year has
signed up three customers and the first revenues are expected to flow in from 4Q11.
The GIS JV with ESRI (c8% of service revenues) has been seeing strong traction (up
54% yoy in 1H11). The company expects near term demand growth to be sustained by
APDRP.
Growth in international revenues from GIS (currently 20-25% contribution) is being driven
by partnership with ERSI resellers outside India for implementing turnkey solutions.
NIIT Tech is working on a couple of large government RFPs, which can potentially
replace revenues from the Rs2.3bn BSF contract that are largely booked in FY11.
Tax rates to rise sharply in FY12; site consolidation and bulge mix are levers
Tax rates will jump significantly in FY12, as the company's Greater Noida SEZ will
become
No comments:
Post a Comment