Education is a vast and growing field for every country, but it has special connotation for the enormous population of China. The country cannot meet its economic and development aims unless both children and adults have access to world-class competence development facilities. The central business of this company is therefore closely aligned with a key national objective for Beijing.
The stock derives value through management’s ability to participate simultaneously in the most important and emerging segments of the Chinese education market. The company has its own training center, products to help children do well in tests, online products, and an array of content. There is something for people of all ages who would like to acquire qualifications and new skills.
Net income is likely to register a sharp increase during 2008 as the company spread its wings to new provinces in China. Earnings could also be favorably impacted by further inorganic growth moves. The company has received official recognition by being asked to operate an examination center for vocational training, which will add considerably to its brand image amongst potential new customers.
China has over 35 million students in need of vocational training. The education market is estimated to be worth $4 billion already, and is likely to grow rapidly with active government encouragement. The company has planned to open 30 new training centers to cater to the expected demand for its services. The stock closed the trading day on February 13 2008 at $3.61, after opening at $3.35. The 52-week high is $6.40.
Let us hear your thoughts below: