NIIT plans to push investments in e-commerce related ventures and projects, which will propel its growth plans. This was revealed by a leading financial newspaper.
NIIT commenced operations in 1981, as an infotech (IT) training company (45% domestic market share) to become the ninth largest (in terms of revenues) computer-training institute in the world. It plans to move up the IT value-chain by developing software products. Currently, the company has a presence in 31 countries and operates through 18 fully-owned subsidiaries.
The Internet economy is making its presence felt in India and NIIT wants to make sure that it does not miss the bus. It has lined up investments in Internet technologies and the creation of its own intellectual property rights (IPR).
It plans to leverage its expertise in software solutions and its IT training brand. Its e-commerce and e-governance products (NIIT e-pay Server, NIITe-Mart, NIIT e-portal, NIIT e-Service) include a wide range of activities, which will form an integral part of its e-commerce solutions.
NIIT is on the right track as far as its Internet-based strategy in concerned. But lack of experience in developing products will be a major hurdle. Moreover, marketing these products entails heavy advertising and sales expenditure. This could have an adverse impact on profits in the short run.
Analysts are not impressed with the company's FY99 (32% net profit rise) results and have recommended a 'HOLD' on the stock.
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