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Research Desk
Content In the Spotlight
In the Spotlight 1
Investment Activity 2
News and Policy Development 3
Corporate Developments 4
Stock Market Performance 5
Peer Benchmarking 6
About Four-S Services 8
Vol. 46, 15th Mar’12 – 31st Mar’12
Four-S EDUTRACK
FFoorrttnniigghhttllyy UUppddaattee oonn IInnddiiaann EEdduuccaattiioonn SSeeccttoorr
Govt invites private companies to start secondary schools
Following a road map laid out in the budget, the Union government
has invited proposals from companies to open secondary schools. The
human resource development (HRD) ministry has sought expressions
of interest from companies in joining the public-private partnership
(PPP) project to open 2,500 schools over the next five years. Private
entities will procure the land, and design, develop, operate and
manage the schools while the government will offer a 25%
infrastructure grant and the recurring cost of education for students
sponsored by it. Under the Right to Education Act, at least 25% of a
school’s students can belong to underprivileged families and are
entitled to free education. The government will pay for their schooling.
According to details in the ministry’s documents, even companies
without any experience in education can bid to open schools. “A
corporate entity would be eligible for one school for every `250mn net
worth subject to interest bearing deposit of `5mn each for up to three
schools and `2.5mn per school thereafter,” it said. An education firm
already running at least one Central Board of Secondary Education
(CBSE) school—from which at least two consecutive batches have
graduated from class X—can qualify for three schools under the PPP
project. Firms with schools that have not scaled up to the class X level
will be eligible for one school, the ministry said in the document
explaining the eligibility framework. A company can qualify for three
schools if it has run educational institutes for five years and can deposit
`2.5mn for each school. While the interest from the deposits will
accrue to the government, the capital will be released to the company
in three annual installments after the school starts operation.
About Four-S Services Four-S Services is India's leading provider of Research, Financial Consulting and Investment Banking services with offices in Gurgaon, Mumbai and
Bangalore. We have a proven track record of consistently delivering high quality solutions, enabling our clients to improve the effectiveness of
decision making and acting as a catalyst in achieving business success. We have executed more than 120 mandates across diverse range of
industries including Education, Financial Services, Infrastructure, M&E, IT-ITeS, Auto and Auto ancillaries, Retail, Real Estate and Textile etc
Our Services:
Strategy Consulting
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
Investment activity
Date Investor(s) Target Stake (%) Amount ($Mn) Business Stage
23-Feb-12 Omidyar Network Anudip Foundation NA 0.7 Vocational Training Early
23-Feb-12 Mumbai Angels CarveNiche Tecnologies NA 0.2 e-learning Early
22-Mar-12 Omidyar Network EnglishHelper NA NA Vocational Early
22-Mar-12 Omidyar Network Akshara Foundation NA 1.0 K-12 Education Early
20-Mar-12 Hyderabad Angels Edutor Technologies NA 0.4Content
DevelopmentEarly
Date Acquirer Target Stake (%) Amount ($Mn) Target's Business
10-Nov-11 TIME Veta 51% 12.1 Supplemental Education
9-Nov-11 Reliance Industries Extramarks Education Ltd 39% NA Supplemental Education
14-Dec-11 Career Launcher GK Publications NA NA Publications
1-Feb-12 Comp U Learn Tech India Divya Knowledge Process
Management100% NA Education Services
15-Feb-12 Aptech Syntea SA 8.3% NA Education Services
80.810.7
4
9
0
2
4
6
8
10
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
2011 2012
In $
mn
PE InvestmentsInvestment Amount (in $mn) No. of Deals
4.8
0.0
5
2
0
1
2
3
4
5
6
0
1
2
3
4
5
6
2011 2012
In $
mn
M&A Deals
Total Transaction Value (in $mn) No. of Deals
*Only last few deals listed above
Private Equity
Mergers & Acquisitions
Four-S Indian PE Directory 2011 – “A Guide to choosing private equity partners“
Detailed listing of ~330 Active PE/VC Investors in India - PE/VC players that have invested in the past 3 years.
A first-of-its-kind, the directory offers “Deal History” in India for individual investor.
Management, investment profile and Contact details.
User-friendly Spreadsheet Format.
It comes from Four-S Services, the most trusted deal information bank in India.
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
News and Policy Development
UGC to devise AICTE-like rules for foreign varsity tie-ups
Keen to forge collaborations between Indian and foreign
varsities with or without Foreign Education Providers Bill, the
Union HRD ministry has asked the University Grants
Commission (UGC) to formulate regulations for facilitating
entry of foreign education providers in India. A UGC
committee is being set up to devise these regulations, which
are likely to be on lines of twinning formula of the All India
Council for Technical Education (AICTE). The AICTE has drawn
up rules for collaboration and partnerships between Indian
and foreign institutes in the field of technical education and
students enrolled for these courses can complete semesters
in partner institutes. Under similar UGC regulations, a foreign
university would not be able to come to India and set up a
standalone full-fledged campus on its own, it can however, do
so in collaboration with an Indian institute. Students enrolled
will be able to complete one semester in the Indian institute
and complete the rest in the foreign institute.
AICTE says no to new institutes
The All India Council of Technical Education (AICTE) has
decided to put a blanket ban on opening up of new
engineering and management colleges across the country
from academic session 2013-14. India has nearly 3,500
management schools and over 4,000 engineering colleges.
The directive has come after the Council found that the supply
is outstripping the demand for engineering and management
seats in the country. According to note from credit rating firm
CRISIL, the average occupancy rate declined in 2011-12 to
around 67% for engineering colleges and about 65% for
business schools.
Banks to rate institutes for providing Education Loans
To tide over their bad loans and structure their loan products
in a better way, banks will now rate B-schools and other
educational institutions. In a recent meeting between banks
and over 150 education institutes, it was decided that Indian
Banks Association (IBA) will come up with a rating model for
institutes. The process may take about six months.
India to roll out common entrance medical exam from 2013
India is all set to roll out NEET for medicine admissions from
2013-14. For Under Graduate (UG) programs, exam will be
conducted by the Central Board of Secondary Education
(CBSE) while it will be the National Board of Examination
(NBE) that will conduct the Post Graduate (PG) exams. The
Union health ministry has informed state governments that
their existing reservation policies would not be disturbed
under the proposed scheme and state wise eligibility merit
lists will be prepared for the respective state authorities to
admit students for admission in accordance with their
admission criteria in the institutions located in the respective
states. The qualifying criterion has been changed from
percentage of absolute marks to percentile to ensure that no
seat remains unfilled. NEET would mean a single entrance
examination will be held for MBBS and MD courses offered
by all 271 medical colleges. These colleges offer over 31,000
seats for MBBS courses and another 11,000 seats for PG
degrees.
76% RTE violations remain unresolved.
Two years after the government's flagship education
programme came into force, its monitoring body has not
been able to resolve as much as 76% cases of violation of the
right to education (RTE) Act, an RTI document reveals.
Promising free and compulsory education to children from
the age group of 6 to 14, the Right of Children to Free and
Compulsory Education Act came into force on 1st
April 2010.
An RTI query reveals that over the last two years, the NCPCR
received 2,850 complaints regarding the RTE Act. However, it
has been able to resolve just 692 cases, or just 24% of the
entire lot by now.
World Bank offers $500mn loan for education in India
The World Bank has offered $500mn interest-free credit to
India for improving the standards of secondary education.
The World Bank credit will help the Indian government's
efforts to make good quality education available, accessible
and affordable to all young people at the secondary level
(grades 9 and 10). The project will support all activities as
envisioned in the $12.9bn Rashtriya Madhyamik Shiksha
Abhiyan (RMSA) programme, a flagship government of India
programme for gradual universalization of secondary
education
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
Corporate Development
Azim Premji Trust to sell `15.3bn worth Wipro shares to fund
education
The endowment created by Azim Premji, one of the world's
most generous philanthropists, will sell `15.3bn worth of
shares gifted to it by the Wipro founder to fund an expansive
non-profit education initiative close to the heart of the
software billionaire. The Azim Premji Trust, which was gifted
213mn shares of Wipro in December 2010 (valued then at
`88.5bn), will sell 35mn of them, the first time it is doing so
since the endowment was created. The money will be used to
fund the expansion of Azim Premji Foundation, which is
working to improve teaching and learning in some of India's
most backward districts. It will also help the Azim Premji
University scale up its teaching and research work.
GIMS introduces 3D education in India
Geo Information and Modeling Solution (GIMS) (Google ATC)
is introducing 3D education in India. For the promotion of the
3D education the company is looking for partners and is tying
up with Local Resource Centres across the country via
franchise route. There are plans to introduce Google Sketch
up and 3D technology in 1,000 schools and to educate one
lakh children every year.
Helix PE-backed MT Educare IPO Oversubscribed 4x
MT Educare, a Mumbai-based K-12 tutoring and test
preparation firm, has seen its initial public offering
oversubscribed more than 4 times priced at `74-80 a share.
MT Educare is backed by India-focused private equity firm
Helix Investments who would be making 2.5x returns (on the
upper end of the price band) in the part-exit from its four-
and-a-half-year-old investment. MT Educare had launched the
maiden public float with a mix of fresh issue and offer for sale
by the financial investor. At the upper end of the price band,
the company is eyeing a valuation of `3.15bn, a little over 39x
its one-year-old earnings, `80mn. The company is looking to
raise up to `350mn through fresh issue of shares.
Mexus Education partners with St. Xavier’s group of Schools
in Uttar Pradesh
Mexus Education, a leading education technology solutions
provider has partnered with St. Xavier's group of Schools in
Uttar Pradesh to complement the learning environment and
philosophy of the Group. These schools have opted for
technology integration to further leverage the creativity of
students by creating a complete learning environment. All
the 45 schools of The Group spread over Varanasi, Allahabad,
Lucknow and other areas in Uttar Pradesh have opted for
digitization through partnership with Mexus. These schools
have opted for complete school solutions including Iken
Library for a digital classroom, Iken Evaluate for remote-
based objective test, Iken Learning Labs to introduce hands-
on conceptual understanding.
CL Educate ties up with NEC to provide free MBA entrance
coaching
CL Educate, a leading education services provider in India, has
signed a MoU with the North Eastern Council (NEC) to
provide MBA entrance preparation in the North Eastern
Region. The joint initiative aims to encourage economic and
social development of the North Eastern Region by providing
impetus to the growth of the youth. As a part of this
programme CL Educate will prepare 200 students for MBA
entrance examinations (CAT/MAT) in Arunachal Pradesh,
Nagaland, Mizoram, Sikkim and Agartala. The candidates will
be chosen on merit basis and will be coached and mentored
by CL Educate, free of cost, for 6 months in a 7 hr, 6 days
intensive coaching program. The first batch of the
programme is scheduled to start from April 2012.
Shiv Nadar University announces collaboration with Babson
College of USA
The Shiv Nadar University today announced a partnership
with Babson College, the world's no. 1 business school for
entrepreneurship to offer global leading programs in
Entrepreneurship Education to India. Babson's MBA program
has been ranked no.1 for entrepreneurship for 19
consecutive years by U.S. News & World Report. Programs
will commence in 2013. Students completing the programs
successfully will obtain a degree issued by Shiv Nadar
University and a certificate from Babson College.
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
Stock Market Performance
Peer Benchmarking
Market Cap Price
(`mn) (In `) 1 Week 1M 3M 6M 12M
Core Education 31,717 282 0.8% 3.6% 8.7% -3.7% -7.4%
Educomp 18,560 193 -0.6% -8.3% -3.6% -13.7% -55.1%
Navneet 13,805 58 -1.9% 2.9% 9.1% -11.0% 2.2%
NIIT Ltd 8,940 54 10.4% 15.1% 41.2% 20.6% -5.7%
Tree House 7,154 212 3.6% 1.7% 20.9% 21.6% -
Everonn 5,684 261 -4.0% -9.1% -22.0% -24.2% -47.5%
Zee Learn 3,868 15 -0.7% 5.1% 16.8% -21.9% 25.5%
Aptech 3,781 78 -6.4% -9.5% 11.0% -34.7% -25.0%
Career Point 3,518 194 -0.9% -13.2% -8.4% -28.6% -42.7%
Compucom 920 12 -3.8% -12.6% -9.1% -27.2% -33.4%
Edserv 757 29 -11.4% -17.3% -28.6% -66.9% -64.6%
Jetking 312 53 -3.8% -10.3% 5.8% -22.0% -53.7%
Percentage Price Change
Interim Results
Current Last Year % growth Current Last Year % growth Current Last Year % growth
Educomp March 2011-12 Q3 3,738 3,680 2% 963 1,632 -41% 246 967 -75%
NIIT Ltd March 2011-12 Q3 2,501 3,007 -17% 251 370 -32% 407 129 216%
Core Education March 2011-12 Q3 4,793 2,946 63% 1,905 1,050 81% 1,027 579 77%
Navneet March 2011-12 Q3 841 746 13% 57 101 -43% 40 62 -35%
Everonn March 2011-12 Q3 922 1,153 -20% 159 439 -64% -105 189 -155%
Aptech March 2011-12 Q3 432 481 -10% 52 61 -15% 59 33 78%
Edserv March 2011-12 Q3 151 313 -52% 18 146 -88% 5 115 -96%
Career Point March 2011-12 Q3 214 185 16% 88 60 49% 115 54 110%
Compucom March 2011-12 Q3 169 207 -18% 92 117 -21% 21 26 -20%
Zee Learn March 2011-12 Q3 125 98 27% -110 4 NA -126 3 NA
Tree House March 2011-12 Q3 213 - 110 - 61 -
Jetking March 2011-12 Q3 79 94 -16% 13 29 -54% 6 19 -70%
Revenues EBITDA PATYear Ending QuarterFigures in Rs mn Fiscal year
Annual Results
TTM Y0 TTM Y-1 % growth TTM Y0 TTM Y-1 % growth TTM Y0 TTM Y-1 % growth
Educomp Q3 FY12 14,664 11,942 23% 4,754 4,915 -3% 2,248 2,594 -13% 32% 15%
NIIT Ltd Q3 FY12 14,359 11,882 21% 1,522 1,664 -9% 765 468 63% 11% 5%
Core Education Q3 FY12 14,536 10,327 41% 5,740 3,739 53% 3,141 2,095 50% 39% 22%
Navneet Q3 FY12 5,932 5,536 7% 1,348 1,256 7% 845 783 8% 23% 14%
Everonn Q3 FY12 4,037 3,954 2% 1,284 1,356 -5% 216 579 -63% 32% 5%
Aptech Q3 FY12 1,782 1,743 2% 177 168 5% 977 72 1253% 10% 55%
Edserv Q3 FY12 1,201 1,008 19% 357 452 -21% 205 337 -39% 30% 17%
Career Point Q3 FY12 777 761 2% 257 295 -13% 298 247 21% 33% 38%
Compucom Q3 FY12 703 678 4% 416 367 13% 125 106 17% 59% 18%
Zee Learn Q3 FY12 546 - -169 - -199 - -31% -36%
Tree House Q4 FY11 392 214 84% 176 69 153% 92 26 254% 45% 23%
Jetking Q3 FY12 339 408 -17% 57 118 -51% 27 85 -68% 17% 8%
TTM QuarterRevenues EBITDA PAT % EBITDA
margin
% PAT
marginFigures in Rs mn
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
Four-S Services Pvt Ltd
Founded in 2002, Four-S has a strong & successful track record of genuine, accurate and
objective advice to top Indian & global companies & PE Firms. Four-S has already proven
success in corporate finance, strategy consulting, fund-raising, investment banking and
investor relations mandates with 100+ corporates and large PE funds.
Four-S, trusted advisor to top Indian & Global Cos
Offering comprehensive bouquet of services to SMEs, Corporates and PE Funds
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Research Desk
Four-S Services is India's leading provider of high-end research, financial consulting and Investment banking services. We have executed projects for prestigious Indian as well as global corporations, investment banks, private equity funds, venture capitalists and hedge funds including India’s Top 5 PE Funds. For further information, please contact Seema Shukla at [email protected] or reach us as http://www.four-s.com
FOUR-S EDUTRACK
About Four-S Services
Four-S Services provides customized business and financial research to organizations across the globe. The
company also provides Investor Relations consulting to corporate based on in-depth sectoral and company
research. The company has an impressive client profile and a team of senior analysts covering key sectors
including Finance & Banking, IT & Telecom, Retail, Media & Entertainment, Pharmaceuticals, Infrastructure
and Manufacturing amongst others. For further information on the company please visit www.four-s.com
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