Date : 2nd November, 2012

JETKING INFOTRAIN LTD. (JITL)

Stock Performance Details Background

Current Price : Rs. 67.95**

 Jetking Infotrain Ltd (JITL) is engaged in
Face Value : Rs. 10 per share
Hardware and running a Networking Training
52 wk High / Low : Rs. 75.50 / Rs. 37.00Total
Institute.
Traded Volumes : 9,435 shares**
Market Cap : Rs. 40 crore**
 The Company follows the Smartlab Plus
Sector : IT Training Services
teaching methodology. This methodology
EPS (FY2011) : Rs. 3.46 per share
incorporates modern technology training
P/E (TTM) : 16.51 (x)^
coupled with ancient Indian art well being
P/BV (TTM) : 0.69 (x)^
practiced through Yoga.
Financial Year End : 1st April – 31st March
BSE Scrip Name : JETKINGQ
 The Smartlab Plus teaching methodology
BSE Scrip Code : 517063
includes training on communication skills for
**as on 2nd November, 2012; ^ as on June 2012
successful interviews, personal presentations
and workplace etiquette. The students are
Shareholding Details – September 2012 trained to interact with managers at every
level with confidence and clarity.
Share holding
Particulars  Jetking caters to various industries such as
Nos. (%)
IT, BPOs, Retail, Manufacturing, PSUs, and
Promoter & Promoter
27,29,706 46.35 Healthcare etc.
Group Holding
Total Institutional
3,41,115 5.79
Holdings (FIIs & DIIs)  The Company has ISO 9001:2000
Public Holdings 28,18,179 47.86 certification.
Total 58,89,000 100.00

Strategy Focus

 The Company plans to tap working professionals who want to upgrade their skill sets in latest technologies.
An innovative teaching methodology is one of the focus areas for the Company. Jetking has also launched
training programs for its franchisees and incentive schemes for staff members.
 Jetking has embarked on various marketing initiatives such as internet campaigns, generation of referrals
through existing students, alliances with colleges etc.
 The Company has opened a centre in Vietnam marking its international foray and has a tie up with the
largest University there.
 The Company also has recently entered into an arrangement with Sikkim Manipal University in India
whereby Jetkings’ students get a lateral entry into the second and third semester of Sikkim Manipal
University’s BSc (IT-IMS) program.
 Jetking has a tie up with various state governments for skill development programs. It bagged its maiden
skill development project in the state of Gujarat under Tribal Development Department with a mandate to
train 9,000 students over a three year period. To strengthen its presence in untapped territory and expand
its product offerings, Jetking is also in discussion with National Skill Development Corporation (NSDC) to
train 1.87 million students over the next ten year period.

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 Financial Snapshot

Standalone Financials
Particulars
(Rs. In Million)
Income Statement FY12 FY11 FY10
Net Sales / Income from Operations 332.7 388.7 450.0
Expenses
Cost of material consumed 0.0 0.0 0.0
Change in Inventories -1.4 1.9 5.5
Operating Expenses 60.3 66.3 89.9
Power/Electricity Charges 5.4 4.8 5.4
Employee Benefit Expenses 102.6 96.9 65.3
Administrative & Other Expenses 120.6 120.7 139.3
EBIDTA 45.2 98.1 144.6
Depreciation & Amortization 17.3 19.5 20.4
Finance Costs / Interest Expense 6.8 0.2 1.2
Other Income 14.5 20.7 23.1
Profit After Tax (PAT) 21.9 67.4 98.1
Key Ratios – Income Statement
EBIDTA Margin (%) 13.6 25.2 32.1
PAT Margins (%) 6.6 17.3 21.8
Balance Sheet
Networth 376.0 364.3 318.9
Non – Current Liabilities / Loan Funds 23.1 0.0 0.1
Non Current Assets / Fixed Assets 230.6 145.2 154.4
Inventories 6.2 4.8 6.7
Debtors 60.6 59.5 70.8
Key Ratios – Balance Sheet
Debt : Equity (x) 0.03 0.0 0.0
Book Value (BV) (in. Rs.) 63.7 61.8 54.1
Return on Capital Employed (ROCE) (%) 11.7 27.8 51.3
Return on Equity (ROE) (%) 6.9 19.7 34.2
Debtors Turnover (x) 5.5 6.0 6.8
Inventory Turnover (x) 60.5 67.6 47.6
Valuation Ratios
P/E (x) 15.3 10.5 8.2
P/BV (x) 0.8 1.9 2.4
EV / EBITDA (x) 5.2 5.4 4.2
Source: Capitaline.com; as on year ended 31st March, 2012

From the Research Desk of LKW’s Gurukshetra.com

 The Net Sales de-grew by 14.4% to Rs. 332.7 million in FY 2012. The Company is impacted due to
the slowdown in the overall industry and the IT sector. More than 90% of enrollments during the

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 year were in Jetkings’ career courses. Among the career programs, Jetking Certified Hardware
and Networking Engineer (JCHNE) and Jetking Certified' Hardware and Networking Professional
(JCHNP) constituted major enrollments. Newer products, Masters in Network Administrator
(MNA) and Smartgrad targeted towards engineering graduates and other graduates witnessed a
rapid rise in enrollments with major demand coming from the Southern region. The Jetking Do-
it-yourself (DIY) Tablet course bundled with its career programs launched in the last year saw
good traction drawing a large pool of students.

 EBITDA for the same year was at Rs. 45.2 million, translating into a de-growth of 53.9% as
compared to the last year on account of drop in Net Sales and increase in employee costs and
power & fuel expenses. The employee costs account for 31% of the total sales and have
increased on a y-o-y basis. Despite this, the overall Expenses dropped by 1.1%.

 At the Net level, the Company reported a Profit of Rs. 21.9 million, a fall of 67.5%. The
Company paid an Interest expense of Rs. 6.8 million in FY 2012 as compared to Rs.0.2 million.

 Resultantly, the corresponding margins both at the EBIDTA and PAT level also declined and stood
at 13.6% and 6.6% in FY2012 as compared to 25.2% and 17.3% during the previous fiscal.

 While, in FY2011 the company was debt free in FY 2012, the company has taken bank overdraft
which resulted in the loan funds to increase to Rs.23 million from zero in the previous fiscal.

 In Q1, FY 2013, the Net Sales increased by 6.4% to Rs.86.5 million as compared to the similar
quarter of the last fiscal. Expenses grew by 22.6% and resultantly EBITDA posted a 61.2% drop to
Rs. 6.6 million. At the Net Level, the Company reported a Profit of Rs. 3.6 million.

Performance on the Bourses

as on 2nd November 2012

Stock Performance
120
100
80
60
%

40
20 Jet Infotrain BSE Small Cap
-

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 Peer Comparison

The below mentioned table provides a snapshot of the financial performance for FY2012 for JITL as
compared to some of its closest comparable peers with similar business model and operating in the
overall IT sector.

Standalone Financials
Particulars (Rs. In Million)
Jetking Infotrain NIIT Aptech
Net Sales 332.7 7,345.7 909.5
EBIDTA 45.2 320.8 132.6
PAT 21.9 962.5 182.0
EBIDTA Margins (%) 13.6 4.4 14.6
PAT Margins (%) 6.6 13.1 20.0
P/E (x)^ 16.5 16.2 18.5*
P/BV (x)^ 0.7 1.1 1.4*
Debt : Equity (x) 0.03 0.4 0
EV / EBIDTA (x)^ 5.7 3.0 9.81*
Source: Capitaline Database; as on 31st March, 2012; ^ as on June 2012;* as on September 2012.

About the Industry Outlook

India’s vocational education space holds out good
potential. There is a lot of focus by the
Government of India on skill development
through its various initiatives such as National
Skill Development Corporation (NSDC), National
Vocational Education Qualification Framework
(NVEQF) and several other initiatives in different
States. The focus is on training youth with
vocational courses to make them employable.
The Government has an ambition of training 500
million youth by 2022. The Government has also
announced certain benefit in the budget for
vocational training institutions.
Amidst emerging opportunities, primarily
emanating from Governmental intervention,
Jetking initiated a number of proactive steps to
tap these opportunities.
With the global economy still reeling under
slowdown pressure along with headwinds
emerging from Eurozone, the spectre of de-
growth on IT spending is looming on the industry.
Disintegration of the Euro-zone can trigger
reconsideration in IT budgets which could
translate into low expenditure thus impacting
manpower requirement. However, huge domestic
spending led by the Government towards building
core IT infrastructure would insulate the industry
from any significant downturn.
Spending by the Government towards e-
governance channelled through the National e-
Governance Plan (NeGP) is expected to
emerge as the next enabler in driving the IT
industry. The massive investment planned
towards creating core IT infrastructure across
the nation would act as a catalyst towards
skilled resource requirement in the future.
Jetking as a leading resource provider to the
industry is well positioned to reap the
benefits.
Advent of technologies such as cloud
computing, advances in virtualization and
convergence of data centre infrastructures is
expected to generate fresh job avenues and
will require over 2 million professionals by
2015 to meet the demand in the industry.
To bridge the gap of skilled workforce and
increase the employability quotient of the
youth, the Government of India is aggressively
promoting various skill development programs
through central and state funded schemes.
Jetking has fair medium to long term
prospects if it manages scalability well.

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 Financial Graphs

Net Income from Operations

500
450
400
350
Rs. in Million

300
250 450
200 332.7
388.7
150
100
50
0
FY 2010 FY 2011 FY 2012

EBITDA & EBITDA Margins

160 35
140 32.1
30
120
Rs. in Million

25.2 25
100
20
80 %
144.6 15
60 13.6
98.1 10
40
45.2
20 5
0 0
FY 2010 FY 2011 FY 2012

EBIDTA EBIDTA Margins

PAT & PAT Margins

120 21.8 25

100 17.3
20
Rs. in Millions

80
15
%
60
98.1 6.6 10
40
67.4
20 5
21.9
0 0
FY 2010 FY 2011 FY 2012

PAT PAT Margins

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Disclaimer
All information contained in the document has been obtained by LKW’s Gurukshetra.com from sources believed to be accurate and
reliable. Although reasonable care has been taken to ensure that the information herein is true, such information is provided as is
without any warranty of any kind, and LKW’s Gurukshetra.com in particular makes no representation or warranty express or
implied, as to the accuracy, timeliness or completeness of any such information. All information contained herein must be
construed solely as statements of opinion, and LKW’s Gurukshetra.com shall not be liable for any losses incurred by users from any
use of this document or its contents in any manner. Opinions expressed in this document are not the opinions of our company and
should not be construed as any indication of our recommendation to buy, sell or invest in the company under coverage.

Disclosure

Each member of the team involved in the preparation of this report, hereby
affirms that there exists no conflict of interest.

The report has been sponsored and published as part of

Initiative of BSE’s Investors’ Protection Fund

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