Ashish Kacholia’s stock, in which SBI Group acquired a fresh stake in Q3, is worth keeping an eye on
Ashish Kacholia stock: According to Invest India, the education sector in India is one of the largest globally, consisting of approximately 1.49 million schools, 9.5 million teachers, and nearly 265 million students. The market value of this sector is projected to grow from $117 billion in 2020 to $313 billion by 2030, driven by demographic advantages and government initiatives such as the National Education Policy 2020.
As of December 2024, domestic institutional investor SBI Innovative Opportunities Fund acquired 4,344,176 equity shares of NIIT Learning Systems Ltd, representing 3.2 percent of the company. Additionally, renowned investor Ashish Kacholia holds 2.02 percent of the company’s equity shares.
In terms of financial performance, NIIT Learning Systems Ltd experienced a 27 percent decrease in revenue from Rs 16,545 crore in Q2FY24 to Rs 12,087 crore in Q2FY25. The company’s net profit also decreased significantly by 47 percent from Rs 1,191 crore to Rs 629 crore during the same period. The company reported an EBITDA of ₹936 million, showing a 3% year-over-year increase, with an EBITDA margin of 24%, down 27 basis points. The full-year growth is now expected to be over 7% in constant currency terms, revised from the initial guidance of 12-14%.
Despite economic indicators showing positivity, weak customer sentiment and reduced spending by consulting firms and North American real estate businesses impacted the company’s revenue. However, NIIT Learning Systems Ltd managed to add two major clients – a top five FMCG leader and a top ten energy company – in Q2 and achieved a 100% customer renewal rate.
Operational Insights
Operational visibility increased to USD 368 million, with MTS customers growing to 91. Days Sales Outstanding (DSO) improved to 50 days, cash balance reached ₹7,370 million, and free cash flow amounted to ₹3,078 million over the past 12 months. The employee count decreased to 2,323, reflecting efficiency efforts, down 35 quarter-over-quarter and 145 year-over-year.
Strategic Initiatives
The company is focusing on investing in generative AI to boost productivity and learning, while actively seeking acquisitions over the next 3-4 years. Positioned to take advantage of the growing outsourcing trends, the company aims to assist clients in achieving cost efficiency and flexible cost structures through innovative and scalable solutions.
Margin Guidance
Margins are projected to remain at the higher end of the 22%-24% guidance for the year, supported by efficiency improvements and technology investments, despite an increase in headcount. Management is confident in maintaining these levels as operations expand and growth resumes.
Company Profile
NIIT Learning Systems Limited offers Managed Training Services to clients in 30 countries. NLSL provides a comprehensive range of Managed Training Services, including Custom Content and Curriculum Design, Learning Delivery, Learning Administration, Strategic Sourcing, Learning Technology, and L&D consultancy.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.