The Indian education sector is at a crucial stage in its growth phase. The country’s demographic advantage of a large young population coupled with low Gross Enrolment Ratios (GERs) presents a huge opportunity for new entrants in the education sector. In addition to the same, the education sector is very lucrative in India as the people seeking higher education are forecasted to increase. Another peculiar feature of this industry is the negative working capital requirement as the fee is taken in advance from students. The government support for this sector has been immense. However, this had changed slightly during the pandemic.
When the pandemic hit, the structure of learning and schooling including teaching and assessment methodologies, was the first to be affected. The online teaching method could be adopted only by a few private schools with adequate digital infrastructure. On the other hand, some of their low-income private and government school counterparts have completely shut down for not having access to e-learning solutions or are struggling to provide education due to limited access. In India, technology solutions to the challenge seem limited at present to the premier, urban-centric institutions. However, companies such as Career Point which were predominantly into the offline mode of teaching have changed their mode of delivery to fully online and it is expected that all the players would now focus on digital delivery of their content.
Career Point Limited is an Indian education company that provides integrated solutions across the education value chain. Career Point operates in both the Formal and Informal education streams including Pre-school, School Education, Test-Prep, e-Learning, Higher Education, and Vocational Education. By 31 March 2020, the Company had a total number of employees of 460 along with a student base of 25,623. On April 22nd, 2020, Career Point announced the launch of ‘eCareerPoint’ app an online learning platform in order to provide learning solutions during the lockdown. In 2019, the company’s bid to acquire School Net India from IL&FS was approved. However, the deal was not closed due to some investors unwilling to sell their shares
Future Strategies: The Company is focusing on reaching distant geographies using eLearning and digital solutions. In offline mode, the company is putting emphasis on expansion via franchisee offerings and school associations for both formal and informal education division.
Challenges for Education Industry in India
Low Enrolment Rates: Enrolment the rate across the senior classes is quite low, while the girl’s dropout rate has witnessed an increase in comparison to that of boys at primary and secondary levels.
Expensive Higher Education: College, expert, and specialized instruction have turned out to be exorbitant in India. The expense structure of specialized and expert establishments like IIM’s is very high; IIM’s charge INR. 2 lakhs for each semester for MBA classes
Lack of Infrastructure and Resources: A vast number of elementary schools have no structures, fundamental facilities like drinking water, urinals and power, furniture and study materials, and so forth. Substantial quantities of grade schools are single educator schools and numerous schools are even without instructors. As a result, the drop rate is high and a reason for concern
Under Penetration in Rural Areas: Most ed-tech products cater to tier 1 and tier 2 cities and children from the high-income segment, ignoring the majority of students who come from rural areas. This is majorly due to the fact that these segments lack access to digital products and even if there is, they cannot afford to buy them.
The competition space of the India Education Industry is becoming fierce with the influx of new entrants and increased funding. The industry majors are seeing a surge in their number of enrolments each month, especially in online mode, and are looking forward to expanding their services reach further to Tier-3 cities and rural regions as well.
Career Point has a wide reach and is at the premier position in Kota, providing education to 25,000 students across the country. With almost two decades of a strong track record in providing quality education, Career Point enjoys strong brand equity in the education sector.
Unorganized players are also growing in the industry. New small players are entering the market who is offering affordable tutorials. The increasing adoption of technology by these players during the pandemic can hamper the student base of the company.
Future Growth of Career Point
Revenue from operations is expected to grow mainly on the account of increased income from Srajan Capital (NBFC subsidiary) and one-off income in Gyan Eduventure (wholly-owned subsidiary. Further, this will be fuelled by the increased investment of Career Point in their NBFC subsidiary. However, with the decrease in the number of student enrolment (especially in the Test Prep division), it is expected that revenue might decrease in later years (2022 and 2023). Formal Education The division is expected to be the major source of revenue in the coming years.
The report would be beneficial for various stakeholders who are interested to understand the overall ecosystem, competition framework, strengths & weakness of Career Point Ltd.
Key Target Audience: –
Education Industry Associations
Time Period Captured in the Report:
Career Point Private Limited
Key Topics Covered in the Report: –
Overview of the Education Industry in India (Including Number of Schools in India, Recent Trends and Developments in the Education Sector, Allocation of Educational Budget by the Government), National Education Policy(Overview of the National Education Policy, Key highlights of the Policy, Gross Enrolment Ratio of Students in the Sector)
Financial Analysis of Career Point (Including Total Revenue, Growth of Revenue (%), Total Expenses, Earnings before Tax & Extraordinary Items, Earnings after Tax (Net Income), Growth of Net Income (%), EPS, and 3 Year Future Cash Flow Analysis and total Revenue Estimates(Discounting Factor Method)
Business Overview of Career Point (Including Business Evolution Timeline, Business Services and Offerings, Key Developments, Management Shareholding Pattern, Business Model: Higher and School Education, Subsidiaries)
Career Point SWOT Analysis and Analyst Recommendations
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