China East Education Shifts Into Conservative Spending Mode

Company discloses a go-slow program for spending $233 million in its coffers earmarked for development of five regional operating centers Key takeaways: China East Education has revealed it could take as long as 10 years to spend $233 million in remaining funds from its 2019 IPO earmarked for development of five regional centers Company’s conservative spending mode may reflect caution as it awaits results from China’s ongoing overhaul of its private education sector By Doug Young What do you do when the outlook for your industry looks extremely murky due…

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Education Stocks Could Offer Bargains – For Those Who Choose Correctly

Massive selloff saw Chinese educator stocks fall as much as 70% on Friday on fears government could ban them from operating for profit Key points: Latest government ‘opinion’ document could ban private after-school education companies from operating on for-profit basis Policy is likely to meet with industry pushback, and also protest from parents who see it as too extreme By Doug Young This week may look like any other for most people, but it has turned into a sudden life-or-death situation for many of China’s private education companies. The group…

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School Operator Hailiang Expands Franchise Model with Private Sector Tie-Up

Deal will see company take over management of two privately owned schools for the first time Key points: Hailiang has expanded its franchise-style business model with a new agreement to take over two privately owned schools in Shandong province The company is unlikely to be affected by the crackdown on private educators due to its focus on primary rather than extracurricular learning By Doug Young As a Sept. 1 “day of reckoning” fast approaches for China’s new generation of private education companies, one name that appears to be positioned above…

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Investors Bet on Older, Offline Plays Among Battered Education Stocks

Embattled sector braces for reckoning day in September when all private educators will be required to have government licenses Key points: China East Education’s rally owes to its newly announced share buyback, as well as growing confidence it will suffer less impact from an ongoing sector crackdown Older players like New Oriental and TAL Education also look well positioned to weather the cleanup By Doug Young There’s nothing like a fire at someone else’s home to divert attention from your own burning house. That’s the latest message coming from China’s…

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