>EDUCATION SECTOR: Aptech, Educomp Solutions, NIIT, Tree House Education & Accessories,GurukulOnline Learning Solutions ITM Group of Institutions,JBCN Education Pvt. Ltd.

OPPORTUNITIES CONTINUES.....


■ Demand robust: All companies were unanimous over opportunities in the Education space. Key insights from various companies indicated enough scope for growth in the existing education landscape as the quality of education was substandard. There was greater acceptance of services offered by corporates which are introducing technology to enhance quality of education by means of multimedia to schools and virtual classrooms, among others.


■ Companies’ interest shifts to skill development: Companies were cautious on bidding for ICT related projects as the business model was felt to be weak with high collection periods. Among government initiatives, Public Private Partnership for skill development has become the area of interest of companies. Of the listed companies, Everonn Education (15mn youth) and NIIT (7mn youth) have entered into partnership with National Skill Development Corporation (NSDC) to train youth for various skills by 2022.


■ Asset light model in vogue: Most companies showed a preference for the asset light model and recurring revenue stream. This mainly stemmed from the fact that companies within each sub segment including formal education (K-12 and Higher education), multimedia to schools, vocational training, tutorial services etc prefer the opex model and management services model rather than incurring higher capital expenditure. Most expansions are expected through an asset light approach and the companies are shifting focus to cash flow generation.


■ Strong interest across listed and unlisted companies: Based on investor response, we realised that investors were keen on understanding the competitive landscape and reasons for serious correction in multiples. From a business standpoint, companies were trying to curb higher capex and debtors days by shifting to the asset light model and segments offering steady revenue stream with lower collection periods such as managing brick and mortar K-12 schools and higher education.


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