NIIT gains 7% as board set to consider share buyback on December 24

Shares of NIIT traded 7 per cent higher at Rs 184 on the BSE on Tuesday after the company announced that it has scheduled a meeting of the board of directors on December 24, 2020 to inter alia consider proposal for buyback of equity shares of the company.

At 12:03 pm, the stock was trading 3 per cent higher at Rs 178, as compared to 0.62 per cent decline in the S&P BSE Sensex. A combined 1.8 million equity shares were changing hands on the counter on the NSE and BSE.

As of September 30, 2020, the promoters held 34.29 per cent stake in the information technology (IT) training services company. Individual shareholders, including high networth individual Ashish Kacholia (2.53 per cent stake), held a combined 23.35 per cent stake. Foreign portfolio investors have 22.16 per cent holding, followed by mutual funds (8.44 per cent) and alternative investment funds (2.9 per cent), data shows.

In the past six months, the stock has outperformed the market by surging 92 per cent, against 30 per cent rally in the S&P BSE Sensex. It hit a 52-week high of Rs 198 on November 23, 2020.

In the previous calendar year 2019, the Company bought shares in buyback for cash at a price of Rs 125 per equity share for an aggregate amount of Rs 335 crore. The buyback process was completed on December 23, 2019.

Meanwhile, for the second quarter ended September 30, 2020, NIIT reported 8 per cent quarter on quarter (QoQ) growth in consolidated net profit at Rs 219 crore. EBITDA (earnings before interest, taxes, depreciation, and amortization) was up 41 per cent QoQ at Rs 34.40 crore, while margins improved by 367 basis points to 16 per cent sequentially during the quarter.