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Sep 13, 2012, 08.19 AM IST
In FY12, India's contributed 4% to CORE Education and Technologies's consolidated revenue. The end-to-end, technology-enabled education solutions provider has order book of over USD 100 million in India.
Below is the edited transcript of the interview
Q. Give us a sense of your business and its outlook
CORE Education & Technologies Limited is an end-to-end, technology-enabled education solutions provider that aims to transform the education spectrum that covers Pre-K, K-12, Higher Education and Vocational Education. The company strives to improve the quality of human capital as well as the global learning ecosystem through innovation. It has presence in US, UK, India, Singapore, Middle East, Hong Kong, Africa and the Caribbean.
Q. The market size of the Indian education system is estimated at USD 45 billion. How much of it do you command?
All over the world we are working with governments to transform the public education system. With this objective we entered India, specifically focussing on PPP projects. Our Indian business is a small part of our global business (4% of consolidated revenues in FY12). However, we have an order book of over USD 100 million in India and going forward we expect significant traction through evolving education space like model schools, vocational education initiatives etc.
Q Can you give us a break-up of your revenue from India and abroad?
Our FY12 revenue grew by 50% to Rs 1,638 crore - 86% of which came from the US, 10% from the UK and the remaining 4% from India and other countries.
Q. Which segment of your business is most profitable and which segment is poised for growth?
CORE’s business is aligned across six key elements of education delivery that are designed to provide CORE’s customers with a comprehensive, end-to-end solution viz. teaching, learning, assessment & intervention, governance, advanced technologies and consulting solutions. In markets like the US and UK, we expect growth across all segments due to government initiatives to improve STEM capabilities of students, improved student outcomes and teacher effectiveness and effective use of federal funds.
Specifically in the Indian market, CORE’s strategy will be centered around growing vocational training programs, teacher training programs, ICT (Information and Communication Technology) solutions aimed at supplying hardware, software and educational content infrastructure to schools over 3-5 years and model schools (model schools represent public-private partnerships to design, build, finance, manage, operate and transfer groups of schools).
Q: E-learning segment has seen the entry of several players to share the pie of online content development. Is the segment set for consolidation with the larger players acquiring the smaller players in the next 5 years?
CORE is currently not marketing e-learning solutions and at present has no such plans in this segment.
Q Your consolidated net profit in the June quarter was down compared to the March quarter. What kind of revenues can you project for full year FY12-13?
First quarter historically is the leanest quarter as far as education domain is considered. Academic year for schools starts in July in US with holidays in May and June. Although we have a practice of not projecting revenue guidance, with schools resuming their operations in July and with consistent growth in our business initiatives in other geographies (UK and India), we feel we are on track to achieve our revenue target for FY13.
Q You have recently won Rs 22 crore project order from Bihar government. Could you give us more details on any other venture or a big order coming in?
In addition to the Bihar, we have received orders for ICT implementation in West Bengal worth Rs 30 crore. We also have orders from Department of Social Justice, Maharashtra worth Rs 7.47 crore for vocational education space to provide training to 15,640 students from 2012 to 2014; West Bengal Electronics Industry Development Corporation (WBEIDC / WEBEL), Kolkata for Operation and Management of Skill Development Academy with an expected revenue of Rs 3.50 crore; and from the State Urban Development Agency (SUDA); Raipur, Chhattisgarh to impart training to 14,000 unemployed urban poor youths in 25 districts in 7 different courses with expected revenue of Rs 9.78 crore.
Q Do you have any capex plan going forward?
CORE is aiming to set up Model Schools under Public Private Partnership model, participate in School Development Programs, intensify Teacher Training programs, and operate Vocational and Skill-based training centers.
Q What about acquisition? Are there any targets in India or abroad? If yes when do you plan to make the announcement?
CORE has identified a multi-faceted growth strategy for the next five years that aims to capitalize on the company’s existing competencies while expanding its product portfolio, customer base and geographic presence. The company plans to execute its growth strategy through a combination of organic product development as well as strategic acquisitions, consistent with its historical operating performance. CORE intends to continue evaluating acquisition opportunities and proposals as they arise and may act rapidly to pursue attractive future opportunities.
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