India Ratings stated that the rating factors in NLSL’s established market position and robust business profile, supporting its revenue growth, strong profitability and comfortable credit profile.
The under-penetrated market of learning & development outsourcing in which NLSL operates and NLSL’s leadership position in the sector further support its rating.
The agency further said that a positive rating action could result from meaningful growth in the operational parameters (new customer added, per customer revenue visibility) leading to substantial growth in the revenue and EBITDA, while keeping the consolidated net adjusted leverage below 1x on a sustained basis.
Developments that could, individually or collectively, lead to a negative rating action include a substantial reduction in the revenue and/or a meaningful decline in the profitability, both on a consolidated and sustainable basis, any significant debt-funded acquisitions and/or higher-than-expected dividend pay-outs, leading to the consolidated net leverage exceeding 2.0x on a sustained basis.
NIIT Learning Systems is a leading managed training services company that is engaged in building skilled human capital and enhancing workforce talent worldwide in corporate segment. It caters to geographies such as the Americas and Europe through its five subsidiaries and functions in diverse sectors such as technology, telecom, BFSI, healthcare, management consulting services, energy, and so on.