NIIT (NIITLTD)

FairStock Score: 25/100 — RISKY

Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• Trading below book value with P/B of 0.93 and book value of ₹76 versus price of ₹70.53
• Very low debt with debt-to-equity of 0.01, indicating a clean balance sheet
• Pays a dividend yield of 1.40%, offering some compensation to patient shareholders
• Promoter holding of 36.98% aligns management interest with minority investors
• Sales growth is positive at 3.32% despite the sharp profit decline

Concerns

• Extremely low profitability with ROE of only 1.85% and ROCE of 5.62%
• Profit growth is down 45.50%, and the latest quarter net profit is just ₹5 crore on ₹101 crore sales
• P/E of 33.88 is optically high, and PEG of 10.20 suggests the market is paying too much for weak growth
• Piotroski F-score of 4/9 points to deteriorating financial health and operational stress

AI Analysis

Let me start with what I see. NIIT is trading at ₹70.53, while the book value is ₹76. That means the market is offering me a rupee of assets at 93 paise. Ordinarily, I pay attention. But cheap can be a trap when the business earns poor returns. ROE is just 1.85%, and ROCE is 5.62%. The latest quarter brings ₹101 crore in sales and only ₹5 crore in net profit. Year-on-year profit has collapsed by 45.5%, and sales growth is only 3.32%. This is not the compounding machine I look for. The Piotroski F-score of 4/9 tells me the financial health is weak; the PEG ratio of 10.20 makes the modest growth look very expensive on an earnings basis. The P/E of 33.88 is misleading because earnings have fallen; it is a low-quality multiple. On the positive side, debt is almost negligible at 0.01 debt-to-equity. The dividend yield of 1.40% provides a small return while I wait, and promoter holding is 36.98%, which aligns their interests with mine to some extent. But a 2/100 FairStock Score matches my unease. In Graham's language, this is closer to an asset play than a going concern with earning power. I need to see a meaningful recovery in margins, sustained sales growth, and a return on equity above, say, the risk-free rate before I call NIIT a candidate. Buying near book value is not enough; the business must earn its keep. Until then, I watch, but I do not commit.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer