Investor Presentation May 2012 1
Agenda • Education & Training: Landscape • Company Overview – Individual Learning Solutions – Corporate Learning Solutions – School Learning Solutions – Skill Building Solutions • Results Update • Future Direction 2
EDUCATION & TRAINING: LANDSCAPE 3
India: Long Term Outlook • Young nation with 54% of population Demographic Dividend under 25 years of age • Trillion dollar economy expected to Growing Economy grow @ 7%+ p.a. • Expected to cross $27 Trillion in 2050 • Global shortfall of 56 million by 2020 Global Workforce requirement • India will have 47 million excess • Central budget for education for FY13 at Rs. 740 billion , up 21% YoY Government Spending on Education and training • Rs. 120 Billion allocated to NSDC for skills development India story is here to stay, however…. 4
Massiv ive e Gaps Exi xist t In In Ac Access & Quali lity ty • Inadequate access and quality of formal education • High drop out rates in schools and low GER in higher education • Low employability • Low workforce productivity • Low capacity and coverage of vocational skills training • Acute skills shortage & unemployment Huge focus on education and training required to unleash potential 5
NIIT In The Emerging Environment NIIT’s Strengths Current Engagement • Long standing brand ILS-IT : IT and Soft Skills • Best in class domain IFBI : Banking, Finance, Insurance partnerships Skills Uniqua : BPO/KPO Skills • Content creation Imperia : Management education Development capability NYJ : Vocational training for the • Processes & tools for service sector distributed delivery of 950+ global delivery centers education Government sponsored • Width and depth of opportunities reach • Innovative Govt: BOOT/BOT contracts pedagogical solutions NIIT nGuru suite • Operations & Project Schools Interactive classrooms Management Education Math Lab, Science Station • Teaching/ learning School ERP content HIWEL Learning Stations • Scalable delivery Teachers Training capability 6
NIIT In The Emerging Environment NIIT’s Strengths Current Engagement Tie up with 100+ universities • Institutional Joint certification and dual Higher alliances models qualification programs Education • Global linkages NIIT Inside solutions • Best in class custom Provider of products and content capability services to • End-to-End Training − Corporate Leading technology outsourcing capability companies Training • Partnership with all − Major Fortune 500 companies major technology − Governments companies • Established Presence PPP centers in China in 40 Countries Other Developing Strong presence in Africa • Respected training Countries Special projects in provider with solid neighboring countries brand recognition 7
NIIT Opportunity Space: Individuals Enrolments in HE Mn IT/ITES Workforce 14.63 7.5 5.7% CAGR 10.3% CAGR 9.95 2.54 17K 31K 2004 2011 Current 2022P BFSI Workforce Engineering Seats 8.5 6.4% CAGR 1.05 4.3 12.8% CAGR 0.45 1.4k 2.7K Current 2022P 2004 2011 • Demand for employability training of college graduates will remain high, as enrolments rise from 14.6 million (2011) to targeted 40 million (2020) • Demand for skilled workforce in IT/ITES and BFSI sectors will remain high Large opportunity for NIIT in the fast growing services sector Source: NASSCOM, NSDC, MHRD 8
NIIT Opportunity Space: Schools • Teachers Training - 10 million Teachers 24x7 3,000 schools • Vocational Education - is an emerging Collaboration Portal area ERP Math LAB & Science LAB 100,000 schools IT Education Interactive Class Room 1 Mn schools Large market for products and services for improving school education 9
NIIT Opportunity Space: Corporate US Corporate Training Spending 9.5% US Spending at $67 7.0% 6.0% Billion Global training 2.0% spend $100Bn+ $Bn 2006 2007 2008 2009 2010 2011 Source: Bersin & Associates -11.0% -11.0% • Learning and Development (L&D) budgets continue on road to recovery; underscore corporate commitment to training • Reduction in in-house L&D professionals (5.2 per 1000 in 2011 vs 6.7 in 2006) • Training is a specialized function and organizations are increasingly relying on specialists to outsource training Corporate training represents a huge opportunity 10
NIIT Opportunity Space: Skill Building Demand Side Others, • 211 Mn new jobs in 21 key Sectors in next Services, 53.13, 25% 79.57, 38% 10 years • Additional 300 Mn for “Up skilling” Manufacturi • Indian Skill Dev opportunity $120 Bn* ng, 78.88, • 79 Mn new jobs in “Service Sector” 37% Supply Side • Indian Population – 1.4 Bn by 2026 ; 20% (18-24 yrs) – 280 Mn youth • If harnessed, 25% of global workforce by 2026 will be Indians • Aspirations of youth -- towards “Service Sector” Perfect setting for NIIT; Focus on Youth & Service Sector
NIIT: Market Leader with Strong Credentials • One of the largest providers of vocational and professional skills worldwide across various service sectors. Acknowledged market leader in India • Leading player in the school education segment in India. Positioned to take strong advantage of the emerging environment • One of the leading providers of corporate training in the world. Uniquely positioned to take maximum advantage of the growing training outsourcing trend Demonstrated ability to build viable, scalable and sustainable education & training businesses 12
NIIT has made significant contribution to training and education, globally Nurtured over 2000 entrepreneurs Contributed 555,000 IT Enabled >10 Mn school children GNIITians Helped over 4 4 Mn Mn individuals perform better at their jobs IT enablement for 30,000+ IT professionals for Bhutan and Maldives Chinese economy per annum Developed over 200,000 Trained 396,449 school Enhanced income for more than hrs of learning content teachers to leverage IT 75,000 BPL families 13
…and has received numerous recognitions and awards Hig ighest Rated Edu Education Br Brand NIIT received Dataquest ‘Top IT NIIT recognised as Training Company’ Award in 2011 NIIT USA honoured with the 3 India's second most for the 19th consecutive year trusted education Brandon Hall ‘Excellence Awards’ for brand by Brand Performance Support, Learning, and Equity-Nielsen survey Marketing 2011 NIIT won the Gold at Chief Learning Officer NIIT NGuru received eIndia Award magazine’s annual “Chief Learning Officer 2011 for Math Lab and Mobile Learning In Practice” awards Science Lab 14
COMPANY OVERVIEW 15
IT Training To GTD SBS Training and IT Services CLS business Global Talent CAGR >50% + Development Key Competencies SLS Company Developed: - Pedagogy ILS - Management of distributed delivery process, Launch of IFBI - Partnerships & Imperia Launch of NYJ, Pioneered Demerger of and Cloud Franchising in IT Services Education IT Industry Campus Slowdown IPO Launch of Established Uniqua 1982 1993 2000 2004 2006 2008 2011 NIIT has grown from being an IT training company to a global talent development corporation 16
Servicing The Full Labor Supply Chain Individual Corporate School Learning Skill Building Learning Learning Solutions Solutions Solutions Solutions Target Audience School children Young adults Working professionals Value Academics Employability Productivity Proposition Individuals- College Individuals- Non Customer School Corporate Graduates Graduates • Multimedia Teaching • IT, BPO, KPO, BFSI, • Managed Training Services & Learning Content Vocational training Management • IT Learning • Training Delivery for 9 Services Coverage Education in ILS • Teacher Training • Custom Content sectors • Professional Life • School Management Development skills Services India, China, Geographic India , Emerging India, USA, Europe Emerging India Coverage Economies Economies 17
NI NIIT IT: : Las ast t 5 5 Year ar Financia ancial l Track ack Recor cord Rs Mn CAGR: 10% CAGR: 14% Revenue EBITDA 1,569 1,593 1,475* 12,483 12,603* 1,186 11,993 11,486 1,036 10,068 FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 CAGR: 13% Dividend Payout 264** ˃ Number of Shares Outstanding : 248 231 214 214 165 million (FV of Rs 2 each) ˃ Last Bonus, Split : 5:1 Split, 3:2 Bonus; Sept 2008 FY08 FY09 FY10 FY11 FY12 *FY12 numbers include Element K till October 14,2011. Excluding EK, FY12 revenues at 10,417 and EBITDA at 1198 Mn; **Proposed 18
Capital Structure Total Capital employed – Rs. 7,746 million Unsecured • No of Shares – 165.1 Mn Secured Debt Debt • Face Value – Rs. 2 per share 1% 13% Equity 4% Reserves 82% Public, 29% Promoters, 34% Investments Net Fixed * Assets DMF and FI, 25% 32% 13% FIIs, 24% Cash 13% Net Current Assets 30% *NIIT Limited owns 24.4% of NIIT Technologies 19
BUSINESSES OVERVIEW 20
IT Training • Improving individual employability in IT Sector • Career, Career-edge and skills upgrade courses for Technology Partnerships* individuals • For Engineers, Science / Arts /Commerce graduates, working professionals • Instructor-led, enhanced through cloud based solutions • India, China, Developing World *Selected NIIT is Asia’s No. 1 IT training company 21
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