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Education, health and agriculture are also known as recession proof sectors. The education sector in India is one of the thrust areas for investments as the entire education system is undergoing a process of overhaul. The education sector, with an estimated size of US$ 25 billion, entails three goals of expansion, inclusion and quality, to be accepted as one of the best on international canvas.
According to the report, the government has set a target to achieve 21% of gross enrollment ratio (GER) by the end of the 2017.
According to the estimates made on the basis of 2001 population census, nearly 144 million of the Indian population will lie within the age bracket of 18 to 23 (the target age group for higher education) in 2011.
Hence, there lies a huge potential to be unlocked in the Indian education market through organic and inorganic investments.
Expecting the size of the education sector to double to US$ 50 billion by 2015, the Indian government continuously lays emphasis on increasing its expenditure on the same.
Private education sector itself is expected to grow to US$ 70 billion by 2013 and US$ 115 billion by 2018. Investors have short, medium and long term opportunities open for them in this booming sector.
SECTOR FACTS
- India has about 504 universities, 25,951 colleges and 7,89,950 primary and 3,20,354 upper primary schools.
- FDI inflows in the education sector during the period April 2000 to November 2010 stood at US$ 383.35 million.
- According to the 2001 census, the total literacy rate in India is 65.38 %
- There has been a remarkable growth in the number of educational institutions in India. The higher education system in India comprises over 17000 colleges, 20 central universities, 217 State Universities, 106 Deemed Universities and 13 institutes of National importance. These figures will soon inflate as there is a proposition to set up 30 more central universities, 8 new IITs, 7 IIMs and 5 new Indian Institutes of Science.
Indian Finance Minister has said that the proposed allocation for education under the Eleventh Five-Year Plan will be US$ 65.21 billion, taking the share of education in total planned expenditure from 7.7 per cent to 20 per cent.
To accomplish massive expansion and up gradation of the education infrastructure of schools, universities and institutes imparting vocational training, government plans to mark up its expenditure on education from around 10 per cent to 19 per cent.
A bill in the Parliament has also been introduced to open up the education sector for Foreign Universities.
Current GER in India stands at 12.4 per cent. With 546 million people under 25 years of age, there is huge potential in India in the education sector that needs to be tapped.
The country’s fast-growing education sector holds a potential to attract a US$ 100 billion investment over the next five years driven by demand for skilled professionals and need for infrastructure development.
By 2020, to increase the percentage of students going for higher education from the present 12.4 per cent to 30 per cent in the country, India will need 800 more universities and another 35,000 colleges, according to the Education Minister(HRD).
Some recent examples of significant investments in education sector are given below.
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Nikhil Gandhi May Pick 26% in Everonn Education :
Nikhil Gandhi may acquire 26% stake in Everonn Education through SKIL Infrastructure Ltd.
If the deal goes through, he may also make an open offer for an additional 20% stake.Based on the current market cap of Everonn of Rs 906 Cr, Nikhil might have to pay at least Rs 235 Cr for 26% stake.
SKIL Infrastructure has been looking to get into education space domestically and internationally. Nine years ago, it had signed an MoU with IIT Bombay to set up a campus in Gujarat, but the development coudn’t take place. -
Edserv Acquires SchoolMATE – Education Sector :
Edserv is clearly on a acquisition spree as it has announced another acquisition of SchoolMate – Hyderabad based School ERP and CRM solution provider. A few months ago it acquired 2tion.com to proliferate its Online tutoring services business. Edserve currently serves a niche in Education space by providing technology to meet human resource requirements for educational institutions along with focus on content delivery and learning model for schools in India. Its acquisition of SchoolMATE [School Management AT Ease] allow deployment of Education ERP and CRM solution in sync with Vidyadhana – An academic skills monitorng product.
SchoolMATE helps schools in updating parents about their children’s educational performance through various platforms like SMS, E-mail and Web. The solution thus helps schools in automating the information providing process right from admission to school activities.
SchoolMATE’s acquisition will provide Edserv access to more than 70 schools and will help it to achieve its target of 250 schools by the year end.
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