Best Education Stocks in India: A Beginners’ Guide
Summary:
The rapid growth of India’s economy has led to an increased demand for educational institutions, creating new opportunities for investment in Indian educational stocks. In this article, we will explore some of the top education stocks in India suitable for beginners to invest in.
India features highly in the global education sector due to its vast network of prestigious educational institutions. Also, as the home to the world’s largest population in the 5-24 years age bracket, the potential for growth in the education sector is tremendous, creating new investment opportunities in the education stocks of India.
It’s also worth knowing that 100% foreign direct investments (FDIs) are allowed via the automatic route thanks to the expected Compound Annual Growth Rate (CAGR) of around 20% for the Indian online education industry from 2021 to 2025.
Things to consider before investing in education stocks
As a beginner you may feel a little unsure, so here are some tips to make your investment journey as smooth as possible:
- Research well: Before investing, do a thorough research of the education company or stock you want to invest in. Always keep in mind that it is crucial to conduct your own research and not fall for unverified recommendations.
- Calculate risks: Engaging in investments without careful consideration can result in substantial losses. Recognising this characteristic will help you spot potential warning signs before you invest and guide you in making informed decisions.
- Evaluate the company’s financial performance: To gain insights into the company’s historical growth and the performance of the education stock over time, it is essential to examine its past performance. You should review the balance sheets to track the changes and enhancements that have occurred over time.
- Understand the industry landscape: Research the company’s competitors and peers within the industry. Explore the market share and the overall performance of the sector. Additionally, keep an eye out for political and regulatory factors that may have an impact on the industry.
Top education stocks in India
Here is a list of five best education companies in India:
| Stock | Description |
| NIIT Ltd. | NIIT Ltd. specialises in information technology services. It caters to institutions, businesses, and individuals, offering them opportunities to enhance their skills and talents. The range of managed training services provided by NIIT Ltd. includes advisory services, curriculum design and development, learning administration, learning delivery, strategic sourcing, and learning technology.
The company operates across two main business verticals. The first is the Corporate Learning Group, which provides managed training services and learning and development transformation services to leading companies across North America, Europe, Asia, and Oceania. The second vertical is the Career business, delivering a diverse range of learning and talent development programs to individuals and corporate learners in established and growth sectors. |
| Aptech Education | Aptech Education offers informal education and training services in India and globally. It covers various sectors, including retail, aviation, beauty, wellness, media, entertainment, IT, banking, finance, and preschool education. The company's revenue primarily comes from two branches. The first, within the retail business, provides individual training through franchise centres in nearly 40 countries, contributing around 57.07% of the total revenues. The other segment focuses on corporate training for governmental bodies, educational institutions, and public and private companies, making up the remaining 42.93% of revenue.
Aptech Education operates through a franchise-based model, known for its flexibility and scalability. The company partners with institutions like MAAC, Lakme Academy, and Arena for non-formal training. Its current market capitalization stands at INR 1,687.46 crore. It also extends its educational services to the online realm, offering courses in game development, animation, graphic design, and visual effects (VFX). |
| Zee Learn | Zee Learn Ltd. is primarily in the business of education support services. The company operates through three segments: educational services and related activities, construction and leasing (for education), and training, manpower, and related activities.
Their educational services segment offers training and learning solutions, while the construction and leasing segment involves building and leasing commercial properties for educational purposes. The training, manpower, and related activities segment provides consultancy and advisory services for human resources, including staffing and hiring processes. The primary source is core education, which includes preschool, K-12, and higher education. Notably, Kidzee leads the way as the foremost preschool network with almost 2,000 facilities. |
| CL Educate Ltd. | CL Educate Ltd. is a technologically advanced company that facilitates the entire student learning journey. The team is composed of professionals who are alumni of prestigious institutions like the Indian Institute of Technology and the Indian Institute of Management. CL Educate operates through four main divisions: consumer test preparation, consumer publishing, enterprise corporate, and enterprise institutions. |
| Linc Pen Plastic Ltd. | Linc Ltd. Is a manufacturer of writing instruments with a global presence spanning over 50 countries and operates in regions such as Southeast Asia, the Middle East, the United States, the United Kingdom, Europe, South America, Africa, Russia, and the Commonwealth of Independent States.
The company exclusively focuses on the writing instrument and stationery sector, offering a diverse array of products. Their product lineup comprises pens like ballpoint, rollerball, and gel pens, along with markers, highlighters, stationery items, and disinfectants. |
In conclusion
India's education sector holds vast potential, presenting immense investment opportunities. As a beginner investor, it's crucial to research education companies thoroughly, assess risks, evaluate financial performance, and understand the industry landscape, considering competitors, market share, and regulatory factors. Being well-informed is key to a successful investment journey in this growing sector.
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