NIIT Technologies tanks after weak Q1 results

NIIT Technologies tanked 7.29% to Rs 428.45 at 14:12 IST on BSE after consolidated net profit declined 18.7% to Rs 43.20 crore on 6.6% growth in revenue to Rs 577.60 crore in Q1 June 2014 over Q1 June 2013.

The Q1 result was announced during market hours today, 15 July 2014.

Meanwhile, the S&P BSE Sensex was up 61.22 points or 0.24% at 25,068.20.

On BSE, so far 1.08 lakh shares were traded in the counter as against average daily volume of 23,724 shares in the past one quarter.

The stock hit a high of Rs 476 and a low of Rs 424 so far during the day. The stock had hit a 52-week low of Rs 234.25 on 6 August 2013. The stock had hit a record high of Rs 486 on 11 July 2014.

The stock had outperformed the market over the past one month till 14 July 2014, surging 8.4% compared with Sensex's 0.88% fall. The scrip had also outperformed the market in past one quarter, jumping 16.1% as against Sensex's 10.51% rise.

The small-cap firm has equity capital of Rs 60.75 crore. Face value per share is Rs 10

NIIT Technologies (NIIT Tech) attributed the decline in bottom line during the quarter to lower other income at Rs 3.60 crore in Q1 June 2014 as compared to Rs 20.60 crore in Q1 June 2013, on account of revaluation of current assets and liabilities due to rupee depreciation.

"In constant currency, revenues remained flat sequentially during the quarter," said Mr. Arvind Thakur, CEO and Joint MD, NIIT Technologies. "Operating margins declined 171 bps to 13.4% primarily on account of wage increase during the quarter", he added.

"Fresh orders of $124 million were secured during the quarter", said Mr. Sudhir Chaturvedi, COO, NIIT Technologies. "This includes a large multimillion dollar contract with a major airline", he added.

The company added 4 new clients, two in BFSI and two in the Travel and Transportation segment during the quarter. The company said that $295 million worth of business is executable over the next 12 months from the order book.

Mr. Rajendra S. Pawar, Chairman, NIIT Technologies said. "The company continued its momentum of securing large deals during the quarter. Revenues are expected to scale during the second half of the year".

NIIT Technologies provides IT solutions in application development and maintenance, managed services, IP Assets/platform solutions and business process outsourcing in verticals such as financial services, travel and transportation, manufacturing, distribution, healthcare and government sectors.

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