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NIIT LTD 2017-18 Annual Report Analysis

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NIIT LTD 2017-18 Annual Report Analysis
Fri, 15 Mar

NIIT LTD has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

NIIT LTD Income Statement Analysis

  • Operating income during the year rose 0.6% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 18.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 8.0% in FY18 as against 6.8% in FY17.
  • Depreciation charges decreased by 12.2% and finance costs decreased by 24.9% YoY, respectively.
  • Other income declined by 37.6% YoY.
  • Net profit for the year grew by 51.3% YoY.
  • Net profit margins during the year grew from 4.9% in FY17 to 7.4% in FY18.

NIIT LTD Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 8,452 8,505 0.6%
Other income Rs m 137 86 -37.6%
Total Revenues Rs m 8,589 8,591 0.0%
Gross profit Rs m 575 679 18.0%
Depreciation Rs m 457 401 -12.2%
Interest Rs m 258 194 -24.9%
Profit before tax Rs m -2 170 -8,590.0%
Tax Rs m 184 201 8.9%
Profit after tax Rs m 421 637 51.3%
Gross profit margin % 6.8 8.0
Effective tax rate % -9,215.0 118.2
Net profit margin % 4.9 7.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NIIT LTD Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 5 billion as compared to Rs 5 billion in FY17, thereby witnessing an increase of 5.9%.
  • Long-term debt down at Rs 928 million as compared to Rs 2 billion during FY17, a fall of 40.3%.
  • Current assets fell 11% and stood at Rs 5 billion, while fixed assets fell 4% and stood at Rs 2 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 14 billion as against Rs 14 billion during FY17, thereby witnessing a growth of 0%.

NIIT LTD Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 6,628 7,066 6.6
 
Current Liabilities Rs m 4,694 4,972 5.9
Long-term Debt Rs m 1,553 928 -40.3
Total Liabilities Rs m 13,961 14,025 0.5
 
Current assets Rs m 5,265 4,704 -10.7
Fixed Assets Rs m 1,595 1,527 -4.3
Total Assets Rs m 13,961 14,025 0.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NIIT LTD Cash Flow Statement Analysis

  • NIIT LTD's cash flow from operating activities (CFO) during FY18 stood at Rs 874 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -517 million, an improvement of 21.8% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -210 million, an improvement of 52% on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 42 million from the Rs 197 million net cash flows seen during FY17.

NIIT LTD Cash Flow Statement 2017-18

Particulars No. of months 12 12 % Change
Year Ending Mar-17 Mar-18
Cash Flow from Operating Activities Rs m 1,107 874 -21.1%
Cash Flow from Investing Activities Rs m -425 -517 -
Cash Flow from Financing Activities Rs m -433 -210 -
Net Cash Flow Rs m 197 42 -78.6%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for NIIT LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.8, an improvement from the EPS of Rs 2.5 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 90.4, stands at 63.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.3 times, while the price to sales ratio stands at 1.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 39.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Sales per share (Unadj.) Rs 51.0 51.1
TTM Earnings per share Rs 2.5 3.8
Diluted earnings per share Rs 2.5 3.9
Price to Cash Flow x 52.3 39.6
TTM P/E ratio x 63.7 63.5
Price / Book Value ratio x 2.2 2.3
Market Cap Rs m 14,984 14,931
Dividends per share (Unadj.) Rs 0.0 0.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for NIIT LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 0.9x during FY18, from 1.1x during FY17. The current ratio measures the company's ability to pay short-term and long-term obligations.

    Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 1.9x during FY18, from 1.0x during FY17. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

  • Profitability Ratios
  • Return on Equity (ROE): The ROE for the company improved and stood at 9.0% during FY18, from 6.4% during FY18. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

    Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 12.9% during FY18, from 10.6% during FY17. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

    Return on Assets (ROA): The ROA of the company improved and stood at 5.9% during FY18, from 4.9% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Current ratio x 1.1 0.9
Debtors’ Days Days 73 71
Interest coverage x 1.0 1.9
Debt to equity ratio x 0.2 0.1
Return on assets % 4.9 5.9
Return on equity % 6.4 9.0
Return on capital employed % 10.6 12.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how NIIT LTD has performed over the last 5 years, please visit here.

NIIT LTD Share Price Performance

Over the last one year, NIIT LTD share price has moved up from Rs 94.5 to Rs 90.4, registering a loss of Rs 4.1 or around 4.3%.

Meanwhile, the S&P BSE IT Index is trading at Rs 15,187.9 (up 1.9%). Over the last one year it has moved up from 12,411.3 to 15,187.9, a gain of 2,777 points (up 22.4%).

Overall, the S&P BSE SENSEX is up 12.8% over the year.

(To know more, check out historical annual results for NIIT LTD and quarterly results for NIIT LTD)

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For the quarter ended December 2018, NIIT LTD has posted a net profit of Rs 36 m (down 11.3% YoY). Sales on the other hand came in at Rs 2 bn (up 151.7% YoY). Read on for a complete analysis of NIIT LTD's quarterly results.

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