Best Edtech Stocks in India 2023

Education technology, or edtech, is a sunrise sector in India with increasing internet penetration and rising income. Edtech stocks have gained immensely because of these factors the revenues of such companies have grown manifold, as has the bottomline of most. These companies provide products and services that uses technology for educational experiences, both online and offline.

List and overview of Top 10 Edtech Stocks

Navneet Education:  It is one of first publishers to use technology for delivery of educational products. Its subsidiary eSense (future tech) Learning Private Limited provides e-learning services and has also invested. The stock is near 52-week high and is trading above short-, medium- and long-term moving averages. The stock’s RoE and RoCE both have been improving for the last two years. 

MPS: The company offers B2B learning and platform solutions. Its key business segments include content solutions, platform solutions and e-learning solutions.  The stock is near 52-week high and is trading above short-, medium- and long-term moving averages. It has also seen highest recovery from a 52-week low. 

Veranda Learning Solutions: With focus on smaller cities Veranda Learning has carved a niche for itself by offering both online and offline learning solutions. Its PE ratio is low, offering a good entry point, but weak financials have proven to be a drag along with falling promoter stake. 

Shanti Educational Initiatives:  A venture of Chiripal Group of Ahmedabad, Shanti Educational provides education and allied services, especially in K12 schools. The stock has shown high EPS growth attracting growing interest from foreign investors. The company’s financials too have been improving. 

CL Educate: An education company, CL Educate is among the top providers of test preparation and content monetisation solutions. It also has over 200 centres across India and West Asia. The stock is trading above short-, medium- and long-term moving averages with both RoE and RoA improving for the last two years. 

Global Education:  The company offers business and consultancy support to educational institutions and e-learning solutions. The stock is trading above short-, medium- and long-term moving averages and RoCE has been improving for the past two years. 

Career Point: The company has presence in both regulated and non-regulated education segments, including schools, pre-school and e-Learning.  The stock has seen increased interest from foreign investors in recent times and its current PE ratio is below long term average, making a case of attractive entry point. 

Zee Learn: One of earliest entrant in edtech, Zee Learn provides solutions and training both through products and schools on franchisee. The stock is trading above short-, medium- and long-term moving averages, having risen over 20% in the past month, and its RoCE has also been improving for the past two years.  

VJTF Eduservices: Again, one of the older education companies of India, VJTF provides services to operational education projects.  The stock is trading above short-, medium- and long-term moving averages and its RoCE has also been improving for the past two years.  It has a low PE ratio and a turnaround in the bottom-line is also attracting investors. 

Tree House Education & Accessories: It is mainly in the business of pre-school education and also operates in K12 segment. The stock ahs gained nearly 20% in the past one month and is above short-, medium- and long-term moving averages. The stock has also seen highest recovery from a 52-week low. 

Overview of the Edtech Stocks Industry and why Invest in it?

Indian edtech industry is expected to grow to around $10 billion by 2025, according to a PGA Labs and IVCA report and the more than treble in the next five years.  Many factors, including the rise in mobile and internet users, has been helping push the edtech sector in India, which is also helping lift the market capitalization of edtech stocks. This makes for a compelling investment scenario as mor and more edtech startups scale up and list on Indian stock exchanges.  

Factors to Consider Before Investing in Edtech Stocks in India 

Business model: Edtech is a wide term with many services under it. An investor should carefully evaluate the business model of the company they plan to invest in.  

Fundamentals: Investment into a stock should be done only after thorough checks into the earnings, debt and other parameters of financial health of a company. 

Competition: Invest into a company that has some kind of leverage over its peers and has gained substantial market share. 

User base: A company with a user client base is better than one that leans heavily on few clients.
 

Performance Overview of Edtech Stocks  in India

 

Conclusion

India’s edtech sector caters not only to the huge domestic population, but also has great export potential with the experience gained within the country. Add to the IT edge India already possesses, Indian edtech stocks could well be the starts of future. However, factors like lofty valuations and debt level too should be kept in mind before investing in the sector.