EDUCATION NEW OPPORTUNITY

Education New Opportunity: 

Education New Opportunity

Flow of Presentation: 

Flow of Presentation Introduction Present scenario Future prospects Advantages Disadvantages Conclusion

Introduction: 

Introduction Money in teaching Education dawned on corporate world Beeline for this sector Education sector – recession proof Decent returns Fresh capital – overseas Corporate planning – b ig school chain Foreign Institution Bill

Education Industry Overview: 

Education Industry Overview Capacity creation Quality of learning Attract more students Conducive environment Literacy level: Total - 74% Male : 82% Female : 65%

Present Scenario: 

Present Scenario No. of children Institute Over 140 million Govt. run primary schools 60 – 70 million Private primary schools 10 – 15 million Govt. run secondary schools 25 – 30 million Private secondary schools 1 million Private Vocational Institutes Note: 142 million – Don’t go to school Over 75000 – Private schools Source: CLSA India Education Sector Outlook, 2008 and Industry

Present Scenario (cont’d): 

Present Scenario (cont’d) Money invested Segments Rs . 1.8 trillion India's education and training market Rs . 92,000 crore Kindergarten to Class 12 segment Rs . 32,000 crore Private professional college market Rs . 23,000 crore Coaching classes, private tuitions market Source: CLSA India Education Sector Outlook, 2008 and Industry

Future prospects: 

Future prospects Introduction S ervice Providers Public Private Partnership Microfinance Franchise Model Vocational Education

Future prospects a Introduction: 

Future prospects a Introduction Institutes with AV facilitates – Brain Café Private open universities D istance education ICT and e-learning in education Coaching classes Competitive test preparation

Vocational Education: 

Vocational Education Build skilled workforce Percentage: India v/s Developed nation Govt. & private sector: 110 courses Aid by economic liberalization GDP: service industry Early 90’s – 34% 2008 – 56% Expanded to various fields Current market size Rs . 5000 – 6000 crore

Franchise model: 

Franchise model

Future prospects Service provider: 

Future prospects Service provider Educomp Solutions Largest provider of technology Reaches over 21,000 schools Leverages on: Technology E ducation needs of schools Deliver quality services Cost effective products

Future prospects Service provider: 

Future prospects Service provider Business overview – Smart Class Private schools’ initiative Build IT infrastructure Licenses digital curriculum content

Service provider: 

Service provider Provides services to Educational Institutes Acts as consultants Examples: K12 Techno Services Educomp Solutions Zee Learn ( Kidzee & Mount Litera ) Traditional method Current method

Service provider: 

Service provider SCHOOL SOLUTIONS Books Study material Content delivery Transport facilities Uniform IIT training Student counselling Career orientation Curriculum development

Service provider: 

Service provider TECHNOLOGY SOLUTIONS AV, computer & language labs Multimedia teaching aids School ERP & IT management Accounting records management Partner & vendor management TEACHING SOLUTION Training programmes Exposure to latest teaching tools Assessment

Service provider: 

Service provider ASSESSMENT SOLUTIONS Question papers and assessment Regular tests Rewarding procedure Prescribing remedial measures MARKETING SOLUTIONS Brand building Event management Student acquisition Corporate planning

Investment in Service provider firm: 

Investment in Service provider firm Sequoia Capital India – invested Rs 25 cr. Sequoia + SONG Investment Advisor – Rs 75 cr. K12 Techno Services HDFC invested undisclosed amount Kaizen Private Equity Career Launcher Tree House, nursery schooling chain, Mumbai Filed IPO – raise Rs 150 cr.

Future prospects Public Private Partnership: 

Future prospects Public Private Partnership Huge infrastructural requirement Govt. exploring new ways Steps to improve quality of education Private co. provides end-to-end solutions Backlog of 2,00,000 schools Improving access to education

Future prospects Public Private Partnership (cont’d): 

Future prospects Public Private Partnership (cont’d) Contracting failing stage school Source: Fortress Team Research

Future prospects Public Private Partnership (cont’d): 

Future prospects Public Private Partnership (cont’d) Building school infrastructure in rural areas Government does not have the funds to build the infrastructure Private players are reluctant because of low return on investments Private players builds the infrastructure Government gives tax benefits to private players

Future prospects Public Private Partnership (cont’d): 

Future prospects Public Private Partnership (cont’d) Open schooling Improvement in enrolment rate Drop out rate 25% (I- V) 49% (I-VIII) 62% (I-X) Student migrate with families

Future prospects PPP: 

Future prospects PPP Everonn System

Future prospects Private Public Partnership: 

Future prospects Private Public Partnership ICT (Govt. Schools) Educomp’s initiative Competitive bidding 10 state government Builds infrastructure Provides full time instructors Multi – media softwares Course ware to students

Future prospects Public Private Partnership - Outcome: 

Future prospects Public Private Partnership - Outcome Quality education IT-based education Better facilities Need intimate linkage Example: Everonn NIIT

Future prospects Microfinance: 

Future prospects Microfinance Microcredit Clients Loan amount Criterion Trident microfin – 16 schools

Advantages: 

Advantages HRD minister – “Need for change” Growing presence of experts Growth potential in IT Infrastructure not up to mark Need for interactive education Less prone to economic cyclicality

Advantages: 

Advantages Enrolment – growth rate Indian growth story And f inally , the Indian growth story.

Advantages: 

Advantages Student’s performance Co. providing quality Benefits

Advantages: 

Demand for Post-school mentoring Websites Export of services and content Strategic acquisitions Margins sustainable over long-term Indian growth story Advantages

Disadvantages: 

Disadvantages Eligibility criteria Right to Education act Reservation policies Govt. reimbursing cost Change in govt. policies

Disadvantages: 

Disadvantages Broadband connectivity Execution risks Risk after completion of contracts Cumbersome amount of fund Acceptability of set platform

Conclusion: 

Conclusion Focus on areas which don’t have highly fragmented markets