Market Research Report : Education market in china 2014 - Sample by Netscribes, Inc.

Education Market â&#x20AC;&#x201C; China October 2014

Executive Summary Market

Opportunities and Challenges

Trends Government Initiatives

 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-Challenges:

Opportunities: - Opportunity in Language learning and Skills Training Sector - Opportunity in Vocational Education Training Sector - Opportunity in Higher Education Sector

- Providing Quality Higher Education - Mismatch in Regional Demand and Regional Supply - Increasing students going overseas

- Opportunity in Pre-School Education Sector

- Skills mismatch

 Rise of MOOCs  Increasing importance of m-learning

 Increasing Importance of foreign language learning

 Compulsory 9 years education

 China’s National Plan for Medium and Longterm Education Reform and Development (2010-2020)  Government Laws and Regulations

 Project 211  Sino-Foreign Joint Ventures

Major Public Players Player 1

Competition

Player 2

Player 3

Player 4

Player 5

Player 6

Major Private Players Player 1

Player 2 EDUCATION MARKET IN CHINA 2014.PPT

Player 3

Player 4 2

•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 EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

Economic Indicators (1/3) Current Account Balance USD bn

f a

20--

20--e

0 20--

20--e

Exchange Rate: Half Yearly Period Average

USD/INR

Period High

Period Low a

a c b

a a c b

1/1/14

a b

b c

2/1/14

3/1/14

EDUCATION MARKET IN CHINA 2014.PPT

4/1/14

5/1/14

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’

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

Secondary Education • Secondary education includes a 3-year junior secondary school and a 3-year senior secondary school but some systems have a 4year 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 EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

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

Market Size and Growth USD bn f

0 20--

20--

EDUCATION MARKET IN CHINA 2014.PPT

20--e

20-6

Tertiary sector of the Chinaâ&#x20AC;&#x2122;s vast education market have witnessed new entrants over the last few years

SAMPLE

Post Graduate Statistics) No in mn

No in mn

20--

0.0 20--

20--

Total no of students enrolling for Post-Graduate Course

No fo Graduates who enrolled in Post-Graduate courses

New Entrants in Education

No in mn y

f m

r p

0 20--

20--

New enrollment of general teretiary education

20--

secondary vocational education EDUCATION MARKET IN CHINA 2014.PPT

20--

New enrollment of senior secondary education 7

SAMPLE

Overview of higher education in China â&#x20AC;&#x201C; 2012 (1/2)

Graduates

Entrants

Enrollment

Post Graduates

Senior Secondary Education

Junior Secondary Education

Primary Education

Correctional Work-Study Schools

Special Education Schools

Pre-school Education Institutions

EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

Education Market â&#x20AC;&#x201C; Segments (Overview)

Private Education

Online Education

After School Tutoring

Vocational Education

Note: The overview section is related to the segments covered

EDUCATION MARKET IN CHINA 2014.PPT

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--

EDUCATION MARKET IN CHINA 2014.PPT

Online education market in China

SAMPLE

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

USD bn A%

0 20--

20--

Major Players

Player 1

Player 4

Player 2

Player 3

Player 5

Player 6

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

Company Description

Product Description

Courses Offered

Other Services

Text

YY Inc

NetEase Inc

Baidu Inc

EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

Investments in online projects in China Investors

Investments

• Text

EDUCATION MARKET IN CHINA 2014.PPT

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

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

Major Players

Player 1

Player 2

EDUCATION MARKET IN CHINA 2014.PPT

Player 3

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

SAMPLE

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 â&#x20AC;&#x153;future ready skillsâ&#x20AC;? The Ministry of Labor and the Ministry of Education are taking key initiatives to address the current situation

Note: VET for Vocational Education Training EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

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

USD bn y

A% x

0 20--

20--

Major Players

Player 1

Player 2

Player 3

Player 4

EDUCATION MARKET IN CHINA 2014.PPT

Direct Investments – Player 1

SAMPLE CD Investments – Geography-wise

Total Investments – Sector-wise Sector 1 Sector 2

100% Y% Region 1

CD – Segment-wise

Investment Snapshot • The company has been investing since 2010

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

100

• 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 Segment 1

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

• 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. 2. 3. 4. 5. 6.

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

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

Instruments used in teaching is secondary schools Instruments in Teaching

Percent

Power Point

a%;

Courseware

b%;

Online Resources

Learning Management System

Discussion in BBS

Enrollment in Internet based courses in 20-- (all fields) No in mn New Enrollment Total Enrollment Graduates

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

Opportunity in Pre-School Education Sector • 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

EDUCATION MARKET IN CHINA 2014.PPT

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

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

Number of students going overseas to study

0.5 0.4

No of students

0.3 0.2 0.1 0.0

20--

20-EDUCATION MARKET IN CHINA 2014.PPT

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

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

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

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

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 EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

• 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

EDUCATION MARKET IN CHINA 2014.PPT

Trends â&#x20AC;&#x201C; Summary

Rise of MOOCs in China

Trends

Increasing importance of m-learning

Increasing importance of foreign language learning

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

Rise of MOOCs in China (2/4) Local MOOCs Platforms XuetangX

Text

Kaikeba

Text

TopU.com

Coursera Zone

Text Text

Text

Text Text

Text

EDUCATION MARKET IN CHINA 2014.PPT

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

SAMPLE

Increasing importance of m-learning (1/2)

Mobile learning is â&#x20AC;&#x153;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 technologiesâ&#x20AC;?

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--

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

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

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

EDUCATION MARKET IN CHINA 2014.PPT

Porter’s Five Forces Analysis

SAMPLE Impact High

Threat of New Entrants • Text

Impact Medium to High

Bargaining Power of Suppliers • Text

Impact Medium

Competitive Rivalry

Impact High

Bargaining Power of Buyers • Text

• Text

Impact Low Threat of Substitutes • Text

EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

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

Locations – China

Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol

Stock Exchange

Products and Services Category

Headquarters Products/Services

Key People Education

Name

EDUCATION MARKET IN CHINA 2014.PPT

Designation

SAMPLE

Public: Domestic Company – Player 1 (x/x) Financial Snapshot Total Income USD mn

Key Ratios

Total Income

a b 0

Net Profit/Loss

Profit USD mn

x x y 20--

y 20--

20--

y-o-y change (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

• 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 Market Capitalization (USD mn) Total Enterprise Value (USD mn) EPS (USD) PE Ratio (Absolute)

c 0

Financial Summary

Indicators

Particulars

Value (12/05/2014) xx xx xx xx

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 Improved

EDUCATION MARKET IN CHINA 2014.PPT

Decline

SAMPLE

Public: Domestic Company â&#x20AC;&#x201C; Player 1 (x/x) Key Business Segments

Key Geographic Segments

Industry1 x

Region 1 x A%

B% 0%

0% 20--

20--

Region 2

20--

Key Recent Developments Description

News

Overview Approval Joint Venture & Education news

EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

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

• Text

Strength

Weakness

T Threat

Opportunit y • Text

• Text

EDUCATION MARKET IN CHINA 2014.PPT

SAMPLE

Mergers and Acquisitions (2012-2013) Announced Date

Closed Date

Target

Buyer/Investors

EDUCATION MARKET IN CHINA 2014.PPT

Sellers

Size (USD mn)

Strategic Recommendations (1/2) Strategy

Adoption Area

Customized offerings and broadening the portfolio

• Text • Text • Text

Providing career facilitation services

• Text • Text

Branding and Regional Growth

• Text • Text

Enlargement

SAMPLE

• 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 EDUCATION MARKET IN CHINA 2014.PPT

Thank you for the attention Education Market – China report is part of Netscribes Education Series. For any queries or customized research requirements, contact us at: Phone: E-Mail:

+91 22 4098 7600 info@netscribes.com

About Netscribes Netscribes is a knowledge-consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment & business research, business & corporate intelligence, content-management services, and knowledge-software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes is a one-stop shop designed to fulfil clients’ profitability and growth objectives. Disclaimer: This report is published for general information only. Although high standards have been used in the preparation, “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction. EDUCATION MARKET IN CHINA 2014.PPT