This week’s view
According to the China social organization government service platform, Beijing has approved five non-profit institutions for Discipline Training in primary and secondary schools, namely Beijing hope online discipline training school, Beijing ape counseling online discipline training school, Beijing Zhidao online discipline training school, Beijing Zuo Ye Bang online discipline training school and Beijing Lexue Oriental online Discipline Training School.
At present, We recommend two main lines: (1) Vocational Education: Shanghai Action Education Technology Co.Ltd(605098) , Jiangsu Chuanzhiboke Education Technology Co.Ltd(003032) ; (2) Higher education: at present, some higher education stocks 22pe have fallen below 10 times, mainly due to: 1) higher education companies are cautious about mergers and acquisitions, partly due to the current upside down valuation of the primary and secondary markets; 2) at present, most regions have not issued detailed rules for the selection of business and non business, and the market is worried about the policy risk of higher education stocks; 3) concerns about the future price increase and the ceiling of net interest rate. We believe that, On the one hand, the performance of higher education sector continues to be stable. On the other hand, the state accelerates the implementation of vocational undergraduate work, and private undergraduate schools are expected to benefit. They continue to recommend China Education Holdings, hope education, Gaoxin education group, Zhonghui education, China Science and technology training, etc.
Market review: underperformed the Shanghai Composite Index by 2.61%
This week, CITIC education index fell 4.84%, Shanghai index fell 2.23%, underperforming the market by 2.61%. So far in 2021, CITIC education index has fallen by 51.09%, Shanghai index has fallen by 9.94%, and underperformed the market by 41.15%.
Industry news
On December 14, maple leaf education resumed trading at a low opening of 14%, and the company lost 670 million yuan in the year. Maple Leaf Education announced on the Hong Kong stock exchange that as of August 31, 2021, the income from continuing operations was 941 million yuan, a year-on-year increase of 143.9%, a loss of 671 million yuan and a profit of 43.425 million yuan in the same period of last year; The loss attributable to the owners of the company was RMB 3127.6 million and the profit for the same period last year was RMB 505 million. The board does not recommend the payment of a final dividend for the year ended 31 August 2021.
Risk statement
Uncertainty of epidemic impact: the progress of epidemic recovery has an impact on offline education. Risk of policy change in the education industry: the policy change in the education industry affects the enrollment and fees of K12, vocational education and higher education companies. The risk of enrollment not reaching the expected number: the weakening of terminal demand or the weakening of the enterprise’s own advantages make enrollment difficult.
