New Delhi: Computer education company NIIT Ltd will focus on new courses, including management, finance and social media marketing, as it seeks to boost earnings from its non-information technology training business after revenue from its main business remained little changed for the past two years.
“In the next five years, our non-IT (information technology) portfolio could be around 60% of the total education offering,” chief executive Vijay K. Thadani said on Tuesday. “Though the services sector contributes 60% of the country’s GDP (gross domestic product), the education system is not designed accordingly. The first 25 years, we focused on IT training and the next 25 years we will focus on training using IT.”
The change in its business model was prompted by the volatile economic scenario and changing industry requirements, Thadani said. NIIT’s revenue has remained almost stagnant in the past two years. It reported revenue of Rs.1,260 crore in the year ended 31 March 2012, compared with Rs.1,248 crore in the previous fiscal year. In the nine months ended 31 December for which earnings are available, NIIT reported a revenue of Rs.739.3 crore compared with Rs.736.5 crore in the year earlier. NIIT will announce fourth-quarter earnings on 22 May.
Some of NIIT’s courses such as GNIIT were popular when the number of seats in engineering colleges were fewer, but things have changed now with the increase in their number, said Enayet Kabir, associate vice-president and head of education practice at consulting firm Technopak Advisors Pvt. Ltd.
“NIIT did well earlier, but its IT training programme could not develop a robust business model with changing time and industry requirements,” said Kabir. “I think the company has taken the right decision by enlarging its basket.” NIIT said the new courses will help it emerge stronger in the future.
“Like anyone else, we too” have been affected, Thadani said. “Yes, to some extent it has affected our decision. If you ask me if we are doing well, then the answer is yes, but may not be as good as earlier. When a storm comes, you should try to weather it. By enlarging our cake, our basket (of offering), we will weather the storm and emerge stronger.”
As part of its new strategy, NIIT on Tuesday announced the opening of a “cloud campus” to provide education in non-IT space on an “anywhere, anytime” concept. The company will also offer students courses such as banking, application development, data analytics through the so-called cloud campus.
Overall, there will be a bouquet of 100 courses offered through 300 locations by the end of 2013. It will also leverage its existing 800 centres.
“Nearly 40% of our cloud offerings will be in non-metro cities,” said G. Raghavan, chief executive of career building solutions at NIIT. By the end of 2014, the company says it can enrol more than 500,000 students in different courses on its new cloud technology platform, for which it has already invested Rs.50 crore.