Investor Presentation May 2011 About Educomp Educomp is the - PowerPoint PPT Presentation

Investor Presentation May 2011

About Educomp  Educomp is the largest Education company in India and the only company spread across the entire Education Ecosystem  Educomp currently works with ~25,000 schools and serves over 15.5 million learners and educators across the world  Educomp owns India’s largest K12 content library with over 16,000 modules of rich 3D multimedia educational content reaching out to 3.9 million students across ~5,500 private school and 5.8 million students across ~10,550 government schools  Educomp runs ~800 pre-schools, 50 brick & mortar K12 schools, 7 higher-ed colleges, over 275 vocational training centers and has 2.5 million users of its various online businesses  All businesses have a high component of intellectual property and high branding  The company has been growing Revenues & Profits at a 5yr CAGR of over 100% with EBITDA margins close to 50%  Mission: Be among the top five Education Companies Worldwide by 2012 2

Presence across entire Educational Life Cycle Online & Supplemental Education Online & Supplemental Initiatives Assessments & Tutoring E-learning Admissions Test Preparation Platforms Advisory Services Counseling Services Higher Education Vocational Education Vocational Higher & Initiatives Digital Content Solutions High Schools High School Initiatives Professional Pre-Schools Development Initiative School Pre- s 2 – 5 years 5 – 18 years 18 – 21 years 21 – 25 years Education Life-Cycle 3

The only Education Ecosystem Company In India School Learning Solutions Higher Learning Solutions  Professional Development: Teacher Training in technology integration, pedagogy and best classroom practices. Trained 1.6million  Smart Class: Teacher-led educational content solution that teachers till date dramatically improves learning outcomes in Private Schools. Market leader with presence in 5534 schools  JV with Raffles Education : Professional development programs in Fashion Design, Management, B.Com etc. across 7 colleges  EduReach (formerly ICT): Turnkey solutions for computer aided learning in government schools; Only company to have content in 10 regional languages. Market leader with presence in 10550 schools  JV with Pearson : Vocational Training programs in English Language across 13 states training, Accounting, IT, Retail etc. across 279 centers Online, Supplemental & Global Initiatives K12 Schools Pre-Schools (~799 franchisee sign-ups)  Roots to Wings : Educomp’s own pre-school brand; currently 220 pre-  LearningHour : Premium tutoring centers schools franchisee sign-ups  Mathguru : India’s first & largest online math tutor & content portal  EuroKids : 50% stake in Eurokids, the largest pre-school chain in India  WizIQ : Internet Learning Platform to connect students and teachers with 579 pre-schools franchisee sign-ups  Learnhub : Social Learning Network Vendor to Schools owned & run by independent trusts (currently 50  Studyplaces : Education portal for admission advisory services schools operational, visibility of 81 schools)  EducompOnline : Online Learning & Testing platform  Millennium Schools : K12 schools in Tier I and Tier II cities  Vidya Mandir Classes : India’s premier IITJEE Test Prep organization  Takshila Schools : K12 schools in Tier III and Tier IV cities  Gateforum: India’s premier GATE Test Prep organization  Universal Academy Schools : Budget schools brand targeted at  Learning.com : Leading web based K12 Company in US semi-urban towns with a tuition fee of Rs.800 per month  Ask-N-Learn : Singapore's largest K12 company  Le Mont High Schools : International Curriculum schools 4

The Education opportunity in India is estimated at $40 billion India Education Overall Market estimated at $40bn growing at CAGR 16% FY’14 FY’09 K12 Schools $ 80bn $ 40bn Higher Education $ 15 billion $ 39 billion $ 7 billion $ 20 billion Books/ CD Roms/ $ 4 billion Stationery/ $ 7 billion Multimedia in School $ 7 billion $ 1.4 billion Vocational Training $ 15 billion $ 4 billion Test Prep./ Tutoring *CLSA Report March 2008 5

Investment case for Educomp  Educomp benefits from huge cross-selling opportunities by monetizing students across the education life cycle from age 2 to age 25 years  Flawless execution demonstrated across years  Demonstrated innovation in products: SmartClass, Millennium Learning System, One-on-One Learning, ETEN, VSAT technology, Online learning, Technology integrated Supplemental education etc.  High investment in R&D: 400 people in content development, over 100 people in non-digital learning materials  Best in class partnerships & Joint Ventures: Raffles Education Corp. for Higher Education and Pearson plc for Vocational Education  Highly entrepreneurial & experienced management team  Best positioned to benefit from the growing middle class aspirations, growing consumption of quality Educational products as well as growing numbers (because of economic growth, urbanization as well as high birth rates) 6

Investment case for Educomp (cont’d)  High growth:  FY10 consolidated revenues ~$230 million growing at a 5yr CAGR of 108%  FY10 consolidated EBITDA ~$107 million growing at a 5yr CAGR of 106%  FY10 consolidated PAT ~$60 million growing at a 5yr CAGR of 110%  High profit margins:  EBITDA margins approx. 46% over the last 5 years  PAT margins approx. 25% over the last 5 years  Business models with annuity type revenue streams (3yr to 12yr annuity streams)  Low levels of penetration even in our most scaled businesses  Multiple engines of growth & value creation – many of them in early stage  Multimedia in schools  K12 schools  Higher Education  Vocational Education  Supplemental Education  Internet/ Online Learning 7

Multiples engines of growth & value creation Current Mkt Size Educomp Presence Current Penetration Market Position Value Creation Multimedia $160m SmartClass <1.5% No. 1 player High Content ICT $90m EduReach <2% No. 1 player Medium Pre Schools $1bn Roots to Wings, Eurokids <3% No. 1 player High Millennium, Takshila, Universal Academy, Le Mont High Shortage of 200,000 No. 1 corporate K12 Schools $20bn High schools player Professional $15m Teacher Training NM No. 1 player Low Development Higher Shortage of 1500 $7bn Raffles JV Growing presence High Education universities Vocational Among Top 5 $1.4bn Pearson JV NM High Education players Online & Mathguru, WizIQ, VMC, Gateforum, Learnhub, Learning Largest e-learning $7bn NM High Supplemental Hour, EduIgnite, EducompOnline, Studyplaces footprint Global N/A Learning.com, Ask-n-Learn NM NM High 8

Educomp – Business Description

SmartClass: Empowering Teaching, Inspiring Learning Covering 5534 schools and ~3.9 million students How does it work What is SmartClass • India’s largest Digital Content library of over • Solution designed to assist teachers & enhance 16,000 modules of curriculum-mapped, students’ academic performance multimedia rich, 3D content • Also enables teachers to instantly assess and • Classrooms are equipped with Plasma screens, evaluate the learning achieved Interactive digi-boards and overhead projectors No of Schools Signed 5534 6000 4585 5000 3921 3077 4000 CAGR 142% 3000 1737 2000 933 331 90 1000 0 FY06 FY07 FY08 FY09 FY10 Q1FY11 Q2FY11 Q3FY11 10

EduReach: Partnering with Govt. to Bridge the Digital Divide Covering 10,550 schools and ~5.8 million students Overview of ICT Solution • Educomp participates in government initiatives in a ‘Public Private Partnership’ model to IT enable ~1,000,000 government schools in India • Educomp sets up Computer Labs in Govt. Schools and provides:  Multimedia Content in regional languages  Testing and certification in computer education  Full time assistants as well as teacher training  Monitoring and Supervision No of Schools Signed 15426 16000 12012 CAGR 125% 12000 6004 8000 2808 4000 600 0 FY06 FY07 FY08 FY09 FY10 11

Pre-Schools – India’s largest Pre-School company with ~800 Pre-Schools  Eurokids: India’s leading chain of Pre-Schools  First structured and process driven IP in the fragmented space for early childhood  579 pre-schools franchisee sign-ups in the education (2 to 4 years) country catering to over 39,800 kids enrolled  220 pre-schools franchisee sign-ups till from age 2-4 date catering to over 8300 kids  11 Euroschools (K12 schools), operational on  Created pioneering IP of over 100,000 Franchise Basis pages  Recipient of ‘Best Franchisor Award, 2008’ at “Franchise India 2008”  Roots-to-Wings has been awarded 'Emerging Franchisor of the Year 2008' for excellence in Franchising and Business Development, by Franchise India Holdings Ltd. 12