Industry Dynamic

Industry Dynamic

Online Education Industry Becoming a Hot Spot ofInvestment, 8 Concept Stocks Highly Sought by the Market

  The recent news of giant companies entering the online education industry has been frequently spread. This has also made the online education concept stocks in the A-share market continue to receive market attention and become a beautiful landscape in the A-share shock adjustment.

  Analysts pointed out that as a new type of education model, online education is showing a vigorous vitality in the context of the popularization of the Internet. The entry of Internet giants, such as, Taobao and Google, will greatly promote the popularization of online education and improve the acceptance of users.

  It has become an indisputable fact that the online education industry has broad prospects and huge market potential. It begins with Amazon announced the acquisition of Ten Marks, the online math education service provider, then Google tests its Google Helpouts, the C2Conline education platform. After Baidu online education platform going into operation, another important module—video is added to the “Intimate” architecture of Baidu Education. It is reported that the video channel relies on the Baidu online education serviceplatform“Du Xuetang”, which integrates the mainstream online live broadcasting, recording and other courses with users’educational information and the front ends of service search.

  If the above-mentioned major Internet giants involving in online education because they are in the stage of expanding their market share, Hon Hai Precision Industry, Apple’s largest supplier, announced that it will enter the online education market, further explaining how attractive the online education industry is. According to the report, Hong Hai Precision Group is working together with the online application company NetDragon and an investment company led by the former president of Alibaba to jointly march towards the online education market.

  Compared with the traditional offline education, the advantages of online education are mainly reflected in:1。1. There is no space-time limit, so you can learn at any place and any time;2。2. It can make full use of the fragmentation time to learn and the portability of mobile devices continue to play an important rolewith the development of mobile Internet;3。3. Diversified contents, including K12 education (referring to basic education from kindergarten to high school), higher education, various types of preschool education, vocational education and interest education.

  According to IDC forecast data, the current market scale for children and K12 has exceeded 60 billion yuan, and the future growth rate will still maintain at more than 40%. Entrepreneurship in this field currently accounts for 41% of the online startup educationmarket share, the number of investors indicates the dividend and prospects in this field. In fact, in recent years, the proportion of children’s education in China’s household consumption has been rising, while the proportion of online education to offline education is also increasing relatively. According to the National Education Development Statistical Communique of the Ministry of Education, the education and training market will reach 500 billion yuan in the next 5 to 10 years.

  In the selection and allocation of individual stocks, CSCIC stated that the current domestic listed online education companies are mainly content and technology providers. Among them, FANG Zhi Technology, HKUST News and Xin Nanyang are the top content providers, while Li Sichen (bargaining bar trading point), Warburg Pinang (quote bar trading point), Quantong Education (quote bar trading point) , Tianyu information (quote shares trading point) is the leading providersin technology, Tuowei Information also has the business in technology providing.

  Among them, content providers are more attractive. They can not only achieve a good connection with the platform provider, but also build their own platform. They are product-driven and have a brighter outlook and more room for growth. The technology providers are currently looking at a single point, such as, “Home-school communication”of Quantong Education and Tianyu Information, which are merely a platform for communication between home and school, supported by the Ministry of Education and telecom operators and it is a field that BAT is reluctant to get involved. However, in the future, if the "home-school communication" can make good use of the channel between itself and the school, there will be a great potential for growth.