The end of the year is the perfect time to talk about stocks that outperformed all through the year. One such scrip is NIIT Technologies, a mid-sized IT services company. One of the top-performing IT stocks, it has given a return of nearly 40 percent this year, versus the Nifty IT which has gained only 10 percent odd.
Here is a close look at the reasons for this superb show:
Baring Private Equity Asia, which is now the company’s promoters, launched an open offer in July 2019 to increase its stake in NIIT Tech. The buyback was conducted at a price of Rs 1,394 per share.
In December 2019, the board has approved a share buyback plan at a price of Rs 1,725 per share. The proposal is subject to shareholders’ approval.
Secondly, the firm's revenue growth had been much stronger than expected and was higher than its peers.
Moreover, NIIT Technologies has seen consistent improvement in its order book, which will mean better revenues going forward.
After this commendable performance, its valuations are at a premium to the historical average; currently, NIIT stock is trading at about 18 times forward multiple.
First Published: IST