Educomp, incorporated in 1994 is one of India’s leading Education Companies and the only company spread across the entire education ecosystem. From schools to skills; over last two decades, Educomp group has empowered over 30 million learners and educators across over 65,000 schools to imagine, think and create a better future.
Mr. Shantanu Prakash, CMD, Educomp Solutions Ltd. tells us more….
By bringing in the technology angle, Educomp is said to have tried to revolutionize the education sector in the country. How do you assess the journey so far?
Smartclass indeed was and continues to be a revolutionary product and a game changer in the school education space. It changed the way children learnt various subjects in the classroom. In India, our current market share is over 50%. With Smartclass, our reach has been commendable as we successfully installed it across schools in metros as well as increasingly now in Tier II cities. Educomp ushered in the digital revolution in classrooms 10 years ago and today it has become an imperative for schools. In the pre-school sub-segment, our brand Little Millennium caters to over 10,000 kids through 241 establishments. Our K12 Schools under ‘The Millennium School’, ‘Takshila’ and ‘Universal Academy’ are giving different consumer segments a high quality schooling choice with their proprietary learning systems namely The Millennium Learning System and E-DAC system. The story of digital innovations continues at Educomp with the launch of a slew of new products and services like Educomp Online, English Mentor, Uniclass and SmartSchool — all designed to further enhance the teaching-learning experience for both educators and students across the spectrum as technology becomes more accessible.
How is your school business doing in light of lots of action under the K-12 segment in the last decade?
The K-12 segment is largely underpenetrated and offers good growth opportunity for the company. In the K12 segment, we act as vendors to the school run by independent trusts. Currently 45 such schools are operational. This segment is exciting since the business assures annuity type revenues, and high margins. Besides, it is recession-proof and witnesses strong demand due to rising disposable income and the parent’s willingness to pay for good education.
What kind of roadmap do you have for divesting some of your businesses?
We had invested in multiple high growth and marquee businesses in the education sector. In the current scenario, we are prepared to divest partially or even completely in some of those businesses. This will reduce our debt substantially and further strengthen our balance sheet. We have successfully divested Eurokids, India’s largest pre-school chain; sold our 50% stake in Indiacan back to Pearson,and sold Gateforum, India’s no 1 GATE coaching company, to a group of private equity investors.
In recent times, there are some other players who have entered your space. How has been the competition and what makes Educomp Solutions different from the other players that are present in the sector?
Educomp Solutions is the pioneer and the largest player in the organised education services with presence across the entire education lifecycle. We have presence in each of the segments such as multimedia content, ICT, pre-school, K12 School, professional development, higher education, online, and supplemental.
We have an early mover advantage and are market leaders in each of these areas. We believe that a wide national presence and leadership across segments is what sets us apart. Also of note is the fact that the current level of penetration in all of these segments is very low, hence the growth potential for the company is very high.
The Modi government at the Centre is working on a new National Education Policy. The HRD Ministry, headed by Smt Smriti Irani, has invited comments from public on the proposed new policy. What do you think of such steps?
We applaud the government move to set the ball rolling on a new education policy. We are happy that the rethink is happening at such a critical juncture when the country is set to witness a surging youth population, set to peak in 2020. The vision document has already factored in pressing concerns such as re-assessing government spend on education, access to quality education, innovation, research, regulation, poor ranking of our higher institutes globally and education financing. The implementation will depend on the extent of the government’s calibrated approach.
The education sector is in dire need of new thinking and introduction of some radical steps. Traditionally, in the education sector, the challenge has not been so much about knowing what to do. Rather, it is everything about having the requisite nerve and action orientation to do the needful. In this context, we hope to see visible impact in the short term. We must be mindful of our large, impatient young population and its aspirations.