Market Research Report : Education market in china 2014 - Sample

Education Market – China

October 2014

2

Executive Summary

Market

Opportunities and Challenges

Competition

Education market in China was valued at USD xyz bn in 20-- and is projected to grow at a CAGR of y% between

20– to 20--

Online education market is projected to grow at a CAGR of y% between 20– to 20--

Government Initiatives

Compulsory 9 years education

Project 211

Sino-Foreign Joint Ventures

Opportunities:

- Opportunity in Language learning and Skills Training

Sector

- Opportunity in Vocational Education Training Sector

- Opportunity in Higher Education Sector

- Opportunity in Pre-School Education Sector

Trends Rise of MOOCs

Increasing importance of m-learning

Challenges:

- Providing Quality Higher Education

- Mismatch in Regional Demand and Regional

Supply

- Increasing students going overseas

- Skills mismatch

China’s National Plan for Medium and Long-term Education Reform and Development (2010-2020)

Government Laws and Regulations

Increasing Importance of foreign language learning

Major Public Players

Player 1 Player 2 Player 3 Player 4 Player 5 Player 6

Major Private Players

Player 1 Player 2 Player 3 Player 4

EDUCATION MARKET IN CHINA 2014.PPT

3 EDUCATION MARKET IN CHINA 2014.PPT

•Macroeconomic Indicators

•Introduction

•Market Overview

•Direct Investment Scenario

•Role of ICT in Education

•Opportunities and Challenges

•Government Initiatives

•Trends

•Competitive Landscape

•Mergers and Acquisitions

•Strategic Recommendation

•Appendix

4

SAMPLE Economic Indicators (1/3)

Current Account Balance

Exchange Rate: Half Yearly

0

USD bn

20--e

f

20--e

e

20--e

d

20--

c

20--

b

20--

a

5/1/14 4/1/14 3/1/14 2/1/14 1/1/14

USD/INR

c

a

b c

a

b

c

a

b

c

a

b

b

a c

Period Low Period High Period Average


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SAMPLE China Education System – Overview (1/2)

Pre-school Education

• China’s preschool education in urban areas includes children from the age of 1-3 years and primarily comprising of kindergartens which can be full time, part-time, boarding or hourly based

• In rural areas it consists of nursery schools and seasonal kindergartens and in some places also includes children activity centers and mobile aid centers called ‘caravan’

Secondary Education

• Secondary education includes a 3-year junior secondary school and a 3-year senior secondary school but some systems have a 4-year junior/3-year senior plan; a few others have a 2-year senior school structure

• Secondary schools in China are segregated into ‘key’ and ‘ordinary schools’ wherein the key schools have a better academic reputation and are allocated more resources by the state

Higher Education

• A higher education course including both degree education and non-degree education and incorporating college education, undergraduate education and graduate education is being formulated in China

• A very strict enrollment examination system has been introduced to select only those students have received high school graduation marks to ensure the quality of students that are enrolled in the universities

Primary Education

• Primary education takes around 5-6 years to complete and is compulsory and students study Chinese, Mathematics, Science, foreign languages, social morality and music

• As primary education is compulsory in China, most of the primary schools are public


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SAMPLE China will remain the world’s leading market for education in the coming decade


China Education Market – Overview

• Economic development, rising middle class income, vast population and more international students enrolling for

higher studies in China are some of the key growth factors influencing the education market of China

In 2013, per capita disposable income stood at USD xyz, growing y% in real terms

International students have enrolled in over x no of higher education institutions in China

In 2013 the total population was abc mn, an increase of xyz mn over that of 2012 and is further expected to increase after the

announcement of the new policy by the government to allow two children per family, if one of the parents is an only child

Number of children aged between 0-15 constitute a% of the total population in 2013, thereby providing a substantial target base for

the players operating in the concerned segments

0

USD bn

X%

20--

f

20--e

e

20--

d

20--

c

20--

b

20--

a

Market Size and Growth

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SAMPLE Tertiary sector of the China’s vast education market have witnessed new entrants over the last few years


0

20--

c

20--

b

20--

a

Total no of students enrolling for Post-Graduate Course

0

m

20-- 20--

o n

f e d

20--

c b

a

20--

r q p

20--

z y

x

New enrollment of senior secondary education secondary vocational education New enrollment of general teretiary education

New Entrants in Education

Post Graduate Statistics)

No in mn

No in mn

0.0

20--

b

20-- 20--

c a

No fo Graduates who enrolled in Post-Graduate courses

No in mn

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SAMPLE

Graduates Entrants Enrollment

Post Graduates - -

-

Senior Secondary Education

- -

-

Junior Secondary Education - -

-

Primary Education - -

-

Correctional Work-Study Schools

- -

-

Special Education Schools - -

-

Pre-school Education Institutions

- -

-

Overview of higher education in China – 2012 (1/2)


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SAMPLE Education Market – Segments (Overview)

Note: The overview section is related to the segments covered


After School Tutoring Vocational Education

Private Education Online Education

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SAMPLE A prospering middle class and increasing competition….


• The first "Law on Promotion of Private Education "came into effect on 1st Sep,2003 • Private education in China is slowly progressing and gaining priority with more parents ready to invest on their

children’s education • China’s one child policy introduced in the 1979 is a major factor propelling more parents to spend huge amount

and securing their child’s future, though the policy was relaxed in 2013 • The impression that the standard education provided in public schools is not the best when its comes to

preparing their child to compete on an international platform is further driving the private education market

China had x private institutes of higher

education in 20-- with the total strength of x

no of students

No of students admitted in private kindergarten in China were x in over

y no of schools

There were x private primary schools with y no of students in 20--

A total of x students graduated from private institutions of higher education in 20--

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SAMPLE Online education market in China


Major Players

Player 1 Player 2 Player 3

Player 5 Player 4 Player 6

0

USD bn

A%

20--

y

20--

x

Online Education Market - Overview

• Online Education Market in China is valued at USD x bn in 20-- • Market is expected to grow at a CAGR of x% between 20– to 20--

e • With several large players entering the market and promoting the

growth of this sector the market is expected to reach USD x bn in 2015

• In 2013 China surpassed US to become the top country in terms of internet users

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SAMPLE All major internet companies are making a move to get a chunk of this rapidly growing market either by building...

Company Description Product Description Courses Offered Other Services

YY Inc

Text Text

Text

Text

NetEase Inc

Text

Text

Text

Text

Baidu Inc

Text Text Text Text


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SAMPLE Investments in online projects in China

Investors Investments

• Text • Text

• Text • Text

• Text • Text

• Text • Text

• Text • Text

• Text • Text

• Text • Text


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SAMPLE • The “Law on Vocational Education” was issued in 1996

• Vocational education in China is imparted through higher vocational schools, secondary skill schools, vocational high

schools, job-finding centers and other adult skill and social training institutes

• Vocational training has been recognized as one of the most productive elements of education and the government

sees it as a major driver impacting the country’s future economic growth

• `The government has remodeled vocational education making it more job oriented and to help reduce the

unemployment rate

China government urging vocational training education to overcome the mismatch in its labor market

Major Players

Player 1


Player 2 Player 3

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SAMPLE VET market in China is witnessing a steady growth as the government has recognized it as a key sector

7.27 mn graduates will enter the job market in China in 2014 though only a few will land up with a job

The Chinese government has recognized the shortage of skilled workers in the market and has vowed to reduce this discrepancy

Currently there is high unemployment rate in many areas in China and skill mismatch has been attributed as the main reason

The National Plan for Medium and Long Term Education Reform and Development highlights the need to expand vocational education and provides a foundation for change

Large employers must join hands with the government and play their part by investing and training students to develop “future ready skills”

The Ministry of Labor and the Ministry of Education are taking key initiatives to address the current situation


Note: VET for Vocational Education Training

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SAMPLE After school tutoring market in China – (2/2)


Major Players

Player 1 Player 2

Player 3

Player 4

0

20--

x

A%

20--

y

USD bn

After School Tutoring Market – Overview

• Online Education Market in China is valued at USD x bn in 20-- • The market is expected to grow at a CAGR of x% between 20– to

20--e • The market is expected to reach USD y bn in 2015 • In 2013 China surpassed US to become the top country in terms

of internet users • After school tutoring market has proved to be a high income

earning opportunities for many teachers in China • It is one of the six highest growing sectors in China

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SAMPLE


Direct Investments – Player 1

Y%

X%

Total Investments – Sector-wise CD Investments – Geography-wise

CD – Segment-wise

100% 30% 80% 50% 60% 70% 40% 90% 20% 0% 10%

100

100%

Region 1

Segment 1

Investment Snapshot

• The company has been investing since 2010

• Maximum number of investments were seen in the Sector 1

A total of 2 investments were made in the Sector 1 and 1 in the Sector 2

• Segment 1 consist of the sub-segment Education Services

Sector 1

Sector 2

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SAMPLE ICT in education is the key to the development of the skills and knowledge of young generation


• Information and Communication Technology (ICT) plays a crucial role in all walks of life and particularly in education

• ICT in education has captured the attention on a global level and many countries including China have realized the benefits of the introduction of ICT in the educational system

• With China emerging as a country with the largest number of internet users in the world in 2013, the government has embarked on an extensive strategy to formulate the use of ICT in various realms

Major goals of the information technology curriculum in China

1. To cultivate students’ interest in and awareness of information technologies 2. To acquire basic ICT knowledge and skills 3. To develop an understanding of the impact of ICTs on human lives and conditions 4. To develop competence in locating, communicating, processing, and utilizing information 5. To use technologies in responsible and ethical manners 6. To use technologies to support life-long learning and collaborative learning

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SAMPLE Creating awareness and using of latest techniques to promote the use of ICT is being realized


Instruments in Teaching Percent

Power Point a%;

Courseware b%;

Email c%

Online Resources d%

Learning Management System e%

Discussion in BBS f%

Instruments used in teaching is secondary schools

Graduates

Total Enrollment

New Enrollment

Enrollment in Internet based courses in 20-- (all fields)

No in mn

20

SAMPLE


explored but still represent an ever increasing demand and some yet to be explored

• Pre-school education is becoming quite popular for Chinese parents with higher disposable incomes

• Parents are encouraging kids to read and write at an early age so as to broaden their minds

• Also pre-schools are not only focusing on teaching but conduct activities which help in the overall development of the child from the early age

Text Text

Opportunity in Pre-School Education Sector

Text

Text

21

SAMPLE


Increasing student going overseas

• Students going abroad is a challenge for the development of the education market in China

• Although this will act as good opportunity for institutions providing test preparation such as TOEFL, TSE, SAT, ACT, IELTS, GRE, GMAT and LSAT but will act a major challenge for higher education institutions

• With the rise in income parents in China are easily able to afford to send their children for higher education in the US or UK and this in fact has become a status symbol in the Chinese society

• It has been estimated that number of student going abroad for post secondary education will rise in near future mainly because of the limited placement opportunity after post secondary education

Students are going abroad for higher studies which is deterring domestic education growth

0.0

0.1

0.2

0.3

0.4

0.5

20--

b X%

20--

a No of students

Number of students going overseas to study

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SAMPLE


A major initiative taken by the government of China was the introduction and implementation of the 9 year Compulsory Education guaranteeing the right

of every child to receive education

The law has been successfully implemented at various levels and has helped in enhancing the

quality of the whole nation

9 year compulsory education is divided into six years of primary education and three years of secondary

education

The education would be guaranteed by the state and no tuition or miscellaneous maybe charged in

the implementation of compulsory education

Improving the quality of instruction and enabling children and adolescents to achieve all-round

development -- morally, intellectually and physically -- so as to lay the foundation for improving the qualities of the entire nation and for cultivating well-educated and self-disciplined builders of

socialism with high ideals and moral integrity is the main of the law

According to Article 5 : “All children who have reached the age of six shall enroll in school and

receive compulsory education for the prescribed number of years, regardless of sex, nationality or

race. In areas where that is not possible, the beginning of schooling may be postponed to the

age of seven”

• Provisions have been made for children with disabilities in terms of special education schools with places and facilities to suit the study, recovery and living for the children

The Government of China has undertaken several efforts to bring the education of China at par with other advanced…

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SAMPLE China is one of the biggest market for transnational education and promotion of sino-foreign joint venture….


• Joint Sino-foreign provision is an agreement which allows a foreign establishment to set up institutes of higher education in China

• According to this provision foreign institutions must form a joint venture with a Chinese partner to establish educational institutions and offer programmes

• “Regulations of the People's Republic of China on Chinese-foreign Co-operation in Running Schools "came into effect on 1st Sep, 2003

• Sino-foreign universities were initially established as an experiment to observe how Chinese system could learn from these ventures

• As on Sep, 2013 there were 1,979 approved Sino-foreign joint education projects

Major Sino-foreign Universities

Xi’an Jiaotong-Liverpool University

New York University Shanghai

Duke Kunshan University

University of Nottingham Ningbo

Wenzhou-Kean University

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Trends

Rise of MOOCs in China

Increasing importance of m-learning

Increasing importance of foreign language learning

Trends – Summary


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SAMPLE Local MOOCs

Platforms

Text

Text

Text

XuetangX Kaikeba

Text

Text

Text

TopU.com

Text

Text

Text

Coursera Zone

Text

Text

Text


Rise of MOOCs in China (2/4)

Many foreign and local companies have come up with their MOOC platforms to promote distance learning

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SAMPLE


Mobile learning is “any sort of learning that happens when the learner is not at a fixed, predetermined location, or learning that happens when the learner takes advantage of the learning opportunities offered by mobile technologies”

Increasing importance of m-learning (1/2)

The educational apps market in china is expected to reach USD xyz bn by 2015

Educational apps occupy around x% of the total app market in China in 20--

More parents are willing to use mobile apps to teach their children

In 20--more than x mn users in China used their phone on a monthly basis to access Mobile Learning content

Introduction of cloud technology has pushed the m-learning market of China by 60%, making it the fastest growing in Asia

With students becoming more tech-savvy today and educational institutions finding innovative ways to

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SAMPLE Porter’s Five Forces Analysis

Competitive Rivalry • Text

Bargaining Power of Buyers • Text

Threat of New Entrants • Text

Impact High

Impact High

Impact Medium

Bargaining Power of Suppliers • Text

Impact Medium to High

Threat of Substitutes • Text

Impact Low


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SAMPLE Public: Domestic Company – Player 1 (x/x)

Key People

Products and Services

Company Information Locations – China

Corporate Address

Tel No.

Fax No.

Website

Year of Incorporation

Ticker Symbol

Stock Exchange

Name Designation

Headquarters


Category Products/Services

Education

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SAMPLE Financial Snapshot Key Ratios

Financial Summary

• The company earned a net profit of USD xx mn in FY 20--, as compared to a net profit of USD xx mn in FY 20--

• The company reported total Income of USD xx mn in FY 20--, registering an increase of xx % over FY 20--

• The company earned an operating margin of xx% in FY 20-- an increase of xx percentage points over FY 20--

• The company reported debt to equity ratio of xx in FY 20--, an increase of xx % over FY 20--

Financial Summary

Total Income Net Profit/Loss

c b

b

0 0

a a

y

x

20--

y y

Profit USD mn

x

Total Income USD mn

x

20--

y

x

20-- 20--

Indicators Value (12/05/2014) Market Capitalization (USD mn) xx

Total Enterprise Value (USD mn) xx

EPS (USD) xx

PE Ratio (Absolute) xx

Improved Decline

Particulars y-o-y change

(20--) 20-- 20-- 20-- 20--

Profitability Ratios

Operating Margin

Net Margin

Profit Before Tax Margin

Return on Equity

Return on Capital Employed

Return on Working Capital

Return on Assets

Return on Fixed Assets

Cost Ratios Operating costs (% of Sales)

Administration costs (% of Sales)

Interest costs (% of Sales)

Liquidity Ratios Current Ratio

Cash Ratio

Leverage Ratios Debt to Equity Ratio

Debt to Capital Ratio

Interest Coverage Ratio

Efficiency Ratios Fixed Asset Turnover

Asset Turnover

Current Asset Turnover

Working Capital Turnover

Capital Employed Turnover


Public: Domestic Company – Player 1 (x/x)

30

SAMPLE

A%

B%

0% Z%

Y%

20--

x

Z%

Y%

20--

x

0%

A%

B%

20--

x x

20--

Y% Y%

20--

x

Y%

Industry1 Region 1 Region 2

Key Business Segments Key Geographic Segments

Key Recent Developments

Description News

Overview

Approval

Joint Venture & Education news



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SAMPLE

• Text • Text

• Text

• Text

T O

W S Strength Weakness

Opportunity

Threat



32

SAMPLE Mergers and Acquisitions (2012-2013)

Announced Date Closed Date Target Buyer/Investors Sellers Size (USD mn)


33

SAMPLE Customized offerings and broadening the

portfolio

Strategy Adoption Area

Providing career facilitation services

Regional Growth Branding and Enlargement

Strategic Recommendations (1/2)

• Text

• Text

• Text

• Text

• Text

• Text

• Text

• Educational institutions should try and attract more investment in the sectors of vocational and rural education as they lack behind that of private and online education


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Market Research Report : Education market in china 2014 - Sample

Education

Transcript of Market Research Report : Education market in china 2014 - Sample