Corporate India seems to have taken a leaf out of the books of cash-flush private equity and venture capital funds as it takes a re-look at the recession-proof education segment. And this time it?s not charity or philanthropy that brings them to classrooms, but the simple formula to keep cash registers ringing.
?Education is a $40-billion opportunity waiting to be tapped and Indian corporates have just started realising its potential. Being a counter-cyclical business, it provides insurance against any (economic) downturns and ensure steady returns,? an analyst tracking the sector told FE. One can only expect more companies evincing interest in investing in this sector, he added.
Latest to join the learning curve is the Yash Birla Group, which is scouting for partners to set up a string of new-age schools across the country. The group has floated a special purpose vehicle (SPV), called Birla Edutech, to tap the zooming education business. The company has solicited applications from entrepreneurs, institutions, industries or integrated township developers among others, to invest in its proposed new-age school venture under the brand names Open Minds and Globe Tot?ers. While Globe Tot?ers is a pre-school venture, Open Minds is a chain of K through XII (K-12) schools, a cluster of primary and secondary schools modeled after the US and the UK, with a pan-India footprint. ?Our School Transformation Projects will help several schools to step into new-age learning,? the company said.
Home-grown electronic gadgetmaker Usha Martin recently joined the education bandwagon through its wholly owned subsidiary Usha Martin Education and Solutions Ltd (UMESL). The Rs 3,000-crore corporate house is in the process of setting up a chain of high-end English medium K-12 schools in non-metro towns offering end-to-end solutions and school management services. The company is planning to have at least 200 such knowledge centres across the country in association with qualified partners in learning management services.
Mukesh Ambani-promoted Reliance Industries Ltd (RIL) had already booked a space in the education front with its Dhirubhai Ambani Institute of Information and Communication Technology housed in Ahmedabad while life science company Zydas Cadilla Healthcare tested the waters with the launch of an English medium school, Zydu Cadilla School for Excellence.
The Adani Group, with interests in ports, infrastructure and gas, is shelling out close to Rs 200 crore to set up a port management institute near its subsidiary Mundra Port in Gujarat. Detergent-maker Nirma had also made a mark in the education space sometime back by setting up a university and a management school in Gujarat. It has also firmed up plans to set up a maritime engineering institute at a cost of around Rs 40 crore.
Hyderabad-based DRS Group is in the process of setting up 10 international schools at an estimated cost of Rs 150 crore. The Group already has a presence in the pre-school space with its brand DRS Kids, which it launched way back in 2006. Sundaram Multi Pap, the Mumbai-based paper stationery maker, hit the education business recently with the launch of a new vertical under the e-class brandname. The new venture would provide content to high school students in Maharashtra in non-language corses. According to industry watchers, the Foreign Education Providers (Regulatory) Bill, which was passed by Parliament recently, would go a long way in attracting global education majors into the country. The law, which, according to HRD minister Kapil Sibal, is expected to enhance choices, increase competition and benchmark quality in education, has opened the door for foreign education and training providers to come to India. This could just reverse the tide of Indian students going abroad for better education and training facilities. The National Knowledge Commission has estimated that around 1.7 lakh students leave the country to study abroad every year.