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EducompSolutions

Limited June/July2009

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3

Contents

I

IndustryOutlook

4

II CompanyOverview

8

III Financials

24

IV

GrowthStrategy

28

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IndustryOutlook

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5

Stablepopulationbasekeepinggrowth

opportunityaliveLow

literacy

rates

provide

opportunity

Source:Census

2001,

UNESCO

Institute

for

Statistics

database

Good for K-12

Good for highereducation

Chinaover90%

US~100%

Educationspends

in

India

are

highly

disproportionate

vis

vis

population

size

India

Largestmarketopportunityineducationintheworld

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Education

is

the

highest

growing

expense*

Source:Census2001,Economicsurvey200708,DatapublishedbyUGC

*PrivateFinalConsumption

AnnualgrowthandShare(inpercent)

Growingper

capita

income

greater

purchasingpower

Highereducation

penetration

is

increasing However,

still

dominated

by

Govt./Local

Bodies

scopeforincreasingtheprivateparticipation

Consistent

growth

Increasing

share

augurswellforEducomp

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Source:InterimBudget200910,PlanningCommission

Government(stateandcentral)initiativeshighlight

renewedthrust

and

spending

in

this

sector:

Toincreasetheshareofpublicexpenditureto

6%ofGDP(asexpressedintheNational

CommonMinimumProgramme)

Levied3%educationcesstosupportspending

on

education

in

India

KeyallocationsfromtheInterim200910budgetforthe

educationsectorare:

SchoolEducation:

SarvaShikshaAbhiyan(SSA)

Rs.130bn;

National

Programme

of

Mid

day

Meals

Rs.80bn

RashtriyaMadhyamikShikshaAbhiyaan(higherprimarylevelscheme) Rs.11.43bn

Otherslikescholarships,modelschools,higherprimaryeducation~Rs.8.5bn

HigherEducation:

Outlayhasbeenincreasedby900%in11th

FiveYearPlan

UniversityGrantsCommission,TechnicalEducation,ICT~Rs.70bn

VocationalEducation:

500ITIshavebeenupgraded

NationalSkillDevelopmentCorp. Rs.10bn

GovernmenttopromotePublicPrivatePartnerships

(PPP)at

all

levels

vocational,

higher

and

secondarybyprovidingfollowingopportunities:

Provisionofdigitalcontentandtechnology

toK12schools

SettingupownpreschoolsandK12

schools

ImplementationoflargeICTprojects

Largeindustrytoprovidehugeopportunity

US$40bn

K12

Schools

Higher

Education

Tutoring

Pre

school

Vocational

Overall

Education

Marketin

India

Governmentinitiativesbooststheeducationsector

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CompanyOverview

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Introduction

LeadingeducationproductsandservicesproviderinIndiaforK12(kindergartentotwelfth

grade)studentswithalargefootprintinvocationalandhighereducation

Hasdevelopedlargerepositoryofmorethan16,000multimediacontent/modulesfor

Smart_ClassTM,over15,000modulesforMathGuruTM,over100,000pagesoflearningcontent

fortheRootstoWingsTMprogramand511bookscoveringpreschoolthroughtograde12

Servicing

over

11

million

students

in

~23,000

schools

across

the

globe

on

aconsolidated

basis

ClockedCAGRinrevenueofover127%andprofitaftertaxofover120%overthelast3years

55globalofficesandover8,000employees(onaconsolidatedbasis)furtheraddstoCompanys

executionstrength

The

Companys

key

business

areas

can

be

broadly

split

into

two

key

heads:

B2BInitiatives:

(contributes~86%oftotalconsolidatedrevenue)

Smart_ClassTM

providesdigitalcontent to

privateschools

Edureach(formerlyICTsolutions)

instructional

andcomputingtechnologysolutionstopublic

schools

ProfessionalDevelopment teachers training

programmes

DirectInitiatives:

(contributes~14%oftotalconsolidatedrevenue)

Offlineinitiatives

establishpreschools,K12

schools,vocational

and

higher

education

institutions,licensingofcontent

Onlineinitiatives

currentlysellslearningcontent

throughitsonlineinitiatives(including

MathguruTM

andWiziQ)

Sellseducationalaid,CDROMs

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Educomp:TheonlyEducationEcosystemCompanyInIndia

SmartClass:Teacherlededucational

contentsolutionreachingtoover1.98m

students

Edureach

(formerly

ICT):

Turnkey

solutionsforcomputeraidedlearningin

governmentschoolsreachingoutto6.5

Mmstudents

Professional

Development:

Development:Teacher

trainingintechnology

integration,pedagogy

andbestclassroom

practices

Roots

to

Wings:

Educomps

own

pre

school

brand;

currently178franchiseesoperational

EuroKids:50%controllingstakeinEurokids,thelargest

preschoolchaininIndiawithover400preschools

MillenniumSchools:

NetworkofK12schoolsinTierI

andTierIIcities;withatuitionfeeofRs3,000

3,500/month

TakshilaSchools:K12schoolsinTierIIIandTierIV

cities;withatuitionfeeofRs1,5001,700/month

VidyaPrabhat

Schools:Budgetschoolbrandtargetedat

semiurbantownswithatuitionfeeofRs700/month

K12 Content Licensing & Training Teacher Training K12 Schools

JVwithRafflesEducationCorp.:ProfessionaldevelopmentprogramsinFashionDesign,Hospitality,Managementetc

Educomp

Tele

Education

Network:

Tele

EducationNetwork:Traininginaccounting,Englishlanguageetc.throughtopfacultyviaVSATenabledlearningcenters

PurpleLeap:Trainingprogramstoimproveemployabilityofcollegegraduatestomakethemworkplaceready

LanguageEdge:

120hourprogrammesfor

firsttime

English

learners

AgreementwithIGNOU/CII:

Offersspoken

English programmes

LearningHour:

Premiumtutoring

centersbrandedLearningHour

Mathguru:

Indiasfirstonlinemaths

tutor;largest

maths

content

portal

WizIQ:

Internetlearningplatformto

connectstudentsandteachers

worldwide

Learnhub:

Sociallearningnetwork

AuthorStream:

Onlinecommunityto

sharepowerpoint

presentations

Smartclassonline.com

Learning.com:Acquiredmajoritystakein

Learning.com,theleadingwebbasedK12

CompanyinUS

AskNLearn:AcquiredAskNLearn,

Singapore'slargestK12company

Professional & Vocational EducationInternet & Supplemental Education

Global Initiatives

http://www.learning.com/index.htmhttp://learnhub.com/

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PresenceacrossentireEducationalValueChain

2 5 years 5 18 years 18 21 years 21 25 years

EducationLifeCycle

ProfessionalDevelopment

Pre-

School

Initiatives

HighScho

ol

Initiative

s

Higher

&

Vocational

Initiatives

Online

Initiatives

ICT

K1

2Initiatives

http://learnhub.com/

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Thisconsists ofSmart_ClassTM,EdureachandProfessionalDevelopment

Smart_ClassTM:

Enablesteacherstousedigitalcontentinadditiontothemoretraditionalchalkandtalk

methodsofteaching

Digitalcontentlibrarycomprisingmorethan16,000contentmoduleswithsomemodules

availableinin10languagesonsubjectssuchasscience,mathematicsandsocialsciences

Educomphascontractswith1,737schoolsasonMarch31,2009(FY09)reachingoutto ~2

millionstudents

Educompprovidesatotalsolutionincludinginteractiveboards,digitalcontent,projectors

,servers,networkingandaresourcecoordinator

Edureach(formerlyknownasICTSolutions):

Workswithpublicschoolstobridgethedigitaldivideinpublicprivatepartnershipprojects

Set

up

and

maintain

IT

Learning

Labs

on

Build

Own

Operate

Transfer

(BOOT)

basis

or

Outright

Buybasis

CurrentlyexecutingICTSolutionsprojectsinfourteenstates

TillendofFY09,Companyprovidedsolutionstoover12,000schoolsservicingover6.5million

students

Professional

Development:

PartnerswiththeMicrosoft,LearningLinksFoundation,FoundationandMichael&SusanDell

Foundationetc.

Comprisesadedicated200memberteamoftrainersthathas implementedtheCompanys

programsacross15statesinIndia

Trainedover1.4millionteacherstillendofFY09

BusinesstoBusiness Initiatives

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Currently20high schoolsunderoperationwith16,000+

students;expectedtosetup23moreschools byJuly

2010

OneofthelargestpreschooloperatorsinIndia with

over400