Private Investment In The Education Sector

With due government intent falling into place and the Indian education market projected to grow to USD 180 billion in a few years’ time, the need for capital, technology, and best practices from a private player will be invaluable to the sector

- Saurya Bhattacharya

Background

In two of the earlier pieces in a three-part series on the education sector, we had discussed the setting up of K-12 schools and higher education institutions. In the concluding piece, we focus on the investment climate in the sector and key considerations in this regard.

The above shall be looked at through two broad lenses, namely:

(i) Regulatory regime 

(ii) Regulatory climate

Regulatory Regime

Hereunder, we look at some of the key factors that may come up in the context of investment in the education sector:

(i) Which sub-sector to invest in?

Unlike many other sectors which have harmonious sectoral regulators, the education sector has certain distinctive subsectors. Chief among these are:

(a) Pre-school education 

(b) K-12 schools

(c) Higher education (colleges, universities, technical education)

(d) Ed-tech (education provided through technology, media, and innovation)

Each of these sectors is sizeable, with some statistics indicating that the K-12 segment is the largest by revenue. It contributes about 52% of a total education sector market that is estimated at a value of USD 100 billion. Therefore, it is a large canvas for an investor to explore.

(ii) Not-for-Profit?