NIIT Q3 net dives 93%, below forecasts

MUMBAI: India's largest computer education firm NIIT Ltd. stunned the market

on Thursday with a 93.2 per cent fall in its net profit for April-June over the

year ago quarter. New Delhi-based NIIT said its third quarter net profit fell to

Rs 52.9 million ($1.12 million) or Rs 1.37 per share from Rs 780.2 million or Rs

20.19 a share in the year ago period.

Net sales fell 25.2 per cent to Rs1.51 billion from 2.02 billion. A Reuters

poll of 12 brokerages released last week forecast NIIT's net profit to decline

34.76 per cent to a median figure of Rs 509 million and net sales to rise 4.01

per cent to 2.1 billion.

The results were released before the start of trading on Thursday. NIIT

shares ended 0.35 per cent lower at Rs 300.30 on Wednesday versus the 1.41 per

cent fall on the Bombay index . The shares are up 8.76 per cent from their 2001

low of Rs 276.10 in late June, but down 83.5 per cent from their high of

1,823.90 hit on January 22.

The 19-year old NIIT has seen its finances come under pressure in the past

quarter as demand for its shorter-term education courses fell due to a downturn

in the software sector.

Additionally, NIIT provides software services but has exited the low-margin

system integration business, which accounts for a third of its software revenue,

as a part of its restructuring drive.

(C) Reuters Limited 2001.