SINGAPORE (Apr 2): In our EV/Ebitda (enterprise value/earnings before interest, taxes, depreciation and amortisation) multiple versus 5-year Ebitda CAGR (compound annual growth rate) growth screen, some trends caught our attention. The big trend was the Ebitda growth of Chinese education stocks. These have shown strong growth and, judging from
their results announcements, revenues are likely to experience double-digit growth in the next quarter. Another trend was the underperformance of Singapore-listed education stocks Overseas Education, which had negative Ebitda growth, and Raffles Education Corp, which has shown a steep decline in Ebitda.
According to a DBS Group Holdings report last year on the Chinese education sector, Chinese education stocks could continue to be supported by the abolishment of the country’s one-child policy and increasing household income.
