Is the education sector potential often overlooked?

Are shares of companies linked to and catering to the education sector for eg navneet, camlin etc many a times overlooked and not considered as potential multibaggers?

 

My post on Sept 16 2015,

Stock Picks Of Wizards
Navneet Education Ltd is a Future Multi Bagger

 

I know navneet has to be a multibagger simply because of the state of our education sector and the huge opportunity which exists.

But nobody seems to be talking about it.....

My rationale is very simple.... The existing huge gap already and the future recession proof growth in the sector - as our population grows unabated year after year

 

No rocket science or a investment guru is required to highlight this.

Ordinary investors need to just look around and apply common sense

 

What else besides navneet? Something into hardcore - brick and motar education model - i mean not the e-learning so into textbooks etc

 

I feel that education sector is highly regulated and depends upon govt. funding. Thats why there the growth story seems slow. Navneet can become great stock but only if the outreach and schools improve. Right now, govt schools are dumps and private schools are money minting orgs.

 

Interesting perspective.....

But isnt it a matter of time that this too will change? Hopefully we continue to see a sincere and working goverment during 2019-2024

 

@Sachin pathak yes you can hope on the govt. I dont have much hope . I still feel things will move at slow pace.

 

Thats because State govt.s take care of majority of education sector. Not the central govt. which provides funds only.

 

@Sachin pathak Navneet is into printing books and text books and Camlin is into printing stationary materials. Does these companies have any other businesses. What is the kind of margins do these companies earn. I think stationary materials is not exactly a high margin business with many branded and non branded companies. Even ITC has a formidable paper business in printing notebooks. Do you think these companies could raise their profit margins in the future.

 

I have a strong conviction that the education sector in india has a strong potential. So companies like navneet, camlin, pidilite and i hold all three.

ITC with or without Paper should be in everybody's portfolio. Anyother company would go under with the kind of punitive taxes it is slapped with (cigarettes) but ITC remains resilient and remains wealth creator. Great management, superb long term vision and commendable execution of its strategy as it successfully rolls on the long road ahead.

 

Camlin has seen a run up in the last few months ....because of its turnaround status

 

And why do i have this strong conviction ...... Even the poor parents want only one thing for their kids and that is 'good education' and the lengths they go to for this is amazing.

 

@Sachin pathak I don't disagree that education sector is huge but the companies mentioned here form a very small part of that. If you see the cost of text books and stationary is only a fraction of what parents spend on the total education. Most of it goes into either fees of school and tution or coaching classes. Also with regarding to the profit margin, if the companies don't earn a decent profit margin or if there is a lot of competition say for example in notebooks space you have plenty of companies that can make notebooks and it doesn't have a sufficient entry barrier then it would be difficult for the companies to increase their margins by raising prices. I would like your view on this.

 

In education sector there is some failure stories are there ....

Educom
Everon Education
Birla sloka Education

but don't agree with only sector it self give advantage

In software boom there is few companies are multi baggers like
Infosys , TCS, HCLtech , Oracle financial etc ....

but reaming hundreds of companies not utilized that software boom...

sector performance with company management is also important , Navneet management is good in difficult situations , market range , product diversification and so many parameters we should absesrve ...
If we take all calculations may be wrong at final laps because we know fundamental analysis is basically depend up on company annual report , we know " satyam computers " ficticias reserves story ...
all ways market risk is there , finally it should be faced by investor only .....
but we should do our home work like this ......

ALL THE BEST

 

I also agree that education sector is good business to but I I never saw any company making money in this sector, the growth is very less 9 to 10 %. All paper companies are making losses.

You can look into Repro india which also vijay kedia recommended sometime back.
This company is on technology side too.

https://www.reproindialtd.com/

Technology is changing the future of learning only remaining thing is ppl have to adapt it. One day internet will be very cheap in India and no body will be carrying books to school only tablet.

 

with improvement in network and cheap oled panels e-books will be ubiquitous.in very long run printing and stationary will be a niche product and will never be agrowth area.

 

Maybe true in the very long run... But in the very long run we may face our death before the death of paper textbooks.

 

i think mt educare is good for long term.

 

yes mt is good and will enter but will wait a bit for correction.