The late Nelson Mandela once said, “No country can really develop unless its citizens are educated.” Education plays an important part in the building of a nation. The Indian government realises its significance and hence has taken several initiatives and reforms over the years to impart education and instil the values of secularism, equality, respect for democracy and self-belief among its youth.
According to the rankings released by Quacquarelli Symonds (QS), 17 Indian universities have made it to the list of top 300 universities in the Asian continent. Also, the topmost Indian management institute, Indian Institute of Management, Ahmedabad (IIM-A) has been globally ...view middle of the document...
The education market is generally regarded as the only market towards which Indians are not price-sensitive because it has helped them reach their present standard of living and promises better earnings and prospects for their children.
India’s education sector currently offers an estimated US$40 billion market, with a potential 16% five-year CAGR. This spans the kindergarten through grade 12 (K-12) segment (US$20 billion), private professional colleges (US$7 billion) and tutoring (US$5 billion), vocational training (US$1.4 billion), test preparation (US$1.7 billion), and preschools (US$1 billion).
The most attractive and scalable sectors in this group are test preparation, K-12 and preschools. Parents increasingly prefer private institutions in all domains due to the low quality and poor infrastructure of government-owned and -aided institutions. While just 7% of the more than 1 million schools in India are privately owned, they account for 40% of the country’s 219 million students enrolled.
An increase in GPRS use and the introduction of 3G technology in India should also give a boost to concepts such as e-learning in the country. The e-learning market is currently estimated at US$21.5 million and is projected to grow to US$225 million by 2012. A few companies are also concentrating on management systems for schools and colleges which help maintain attendance records, conduct examinations, and manage timetables, administration, reports, and many other things. The publishing of textbooks and other books for children is a low-growth market because of the high (70%) reusability of these books.
The Indian middle class is expected to expand significantly, from 300 million people today to 583 million people in 2025. By 2025, about three-quarters of India’s urbanites will be part of the middle class, compared with slightly more than one-tenth today. As Indians continue to climb the economic ladder, the composition of their spending will likely change significantly. Spending on education is expected to grow by 11% over the next 20 years, to 9% of the household income. With the growth of the Indian middle class and the increase in its members’ spending power, there is expected to be a major supply-demand gap, which opens up many entrepreneurial opportunities in this sector.
ESTIMATED MARKET SIZE OF TEST PREPARATION IN
Test preparation market in India, which consists of both online and regular coaching,
study material, and mock tests for entrance exams — is estimated to reach
INR9,524.2crore / US$1,904.8 million by end of 2012.
69.4% of the total market consists of test preparation for undergraduate courses, which
is expected to generate revenue of INR6,613.7 crore (US$1,322.7 million). This is
followed by test preparation for post graduate courses, with market size of INR2,648.5
crore (US$529.7 million), having 27.8% of market share.
Test preparation for international courses, which encompasses both undergraduate and