NIIT has target of Rs 123: H Shah

Harit Shah of Angel Stock Broking is of the view that NIIT has target of Rs 123.

Shah told CNBC-TV18, "NIIT is the largest IT training company in the country. They have grown at a very rapid rate along with the IT industry for the past two-three years; they have tracked that industry with a lag. So that business is growing at 25-30%. Going forward they are also taking a lot of new strategic initiatives to get into other sectors also such as financial services and management training. It is in a nascent stage but they have the potential to grow at about 100% over the next two-three years."

He further added, "They have managed to renew their focus on the government schools business, this particular sector where the penetrations levels are very low you have players at Educomp also operating this particular space but NIIT, they can grow at 25-30% going forward because of their renewed focus. They had a bit of a receiver’s problem in FY07 since then the government had become more transparent in terms of awarding of the tenders and in terms of paying back the dues on time. So that particular business is also timed for good growth. So going forward we believe that the company can grow at about more than 30% earnings CAGR over the next two couple of years. On that basis we do have a target of about Rs 123 on that stock."