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China 21st eyes debut for end of May
Posted on Wednesday, 16 May 2018 08:12
China 21st Century Education is holding an initial public offering in Hong Kong that gives a market capitalisation of HKD 948.00 million to HKD 1.36 billion (USD 120.76 million to USD 173.25 million).
The Cayman Islands-incorporated schooling provider is selling 360.00 million shares at HKD 0.79 to HKD 1.13 per share with a view to begin trading on the board on 29th May.
China 21st offers education and tutorial programmes for preschool children in its own kindergartens all the way up to junior college and continuing education students.
The company has 15 schools in Shijiazhuang, including one private institution, six Saintach-branded tutorial schools (consisting of 11 centres) and eight nurseries.
China 21st intends to grow its business by increasing market penetration in the Beijing, Tianjin and Hebei province integrated area in a bid to promote the region’s economic development.
According to a Frost and Sullivan report cited in the prospectus, total revenue of the private higher education industry in China has been increasing steadily.
Turnover rose from CNY 64.60 billion in 2011 to CNY 103.70 billion in 2017, representing a compound annual growth rate (CAGR) of 8.2 per cent.
It is expected to advance to CNY 139.00 billion by 2021, or a CAGR of 7.6 per cent from 2017.
China 21st is using proceeds to fund the acquisition and rebranding of third-party pre-schools as part of plans to expand its own Saintach kindergarten network in the cluster by the end of 2020.
The group wants to add small-group tutoring services providers to its own Saintach tuition centres, though money will also be used to maintain and upgrade facilities and improve student accommodations.
Growth strategies also include establishing a presence overseas, diversifying educations services to widen revenue base and strengthen international cooperation with international institutions.
Revenue has risen from CNY 147.30 million in the financial year ended 31st December 2015 to CNY 169.70 million in FY 2017.
Similarly, net profit has increased from CNY 26.70 million to CNY 45.00 million over the same timeframe.
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