The Chinese educational reform to kill the sector. TAL among the first victim
Neuigkeiten aus der Branche
The Chinese government is going to reform the education sector. This industry is among the most fast-growing spheres, and officials decided to limit private educational companies. What are the upcoming changes? Chinese educational companies are about to be forcedly transformed into non-commercial institutions. Furthermore, the government will allegedly forbid those organizations to access IPOs and attract investments.
Furthermore, public and foreign companies will not be able to invest in Chinese educational companies.
Such an announcement led to a tremendous decline in the educational market – educational companies have experienced the immediate crash of their capitalization.
TAL Education, the leading Chinese player in the education market, lost 70.3% of its market capitalization that decreased from $26 billion to $9.5 billion. The community focused its attention on this major player; meanwhile, TAL Education is not the only victim of the upcoming changes.
Gaotu’s capitalization has collapsed by 62.9%, and New Oriental Education faces a 58.3% decrease.
Furthermore, the experts inform traders about the possible delisting of the herein mentioned stocks. At present, the capitalization of the Chinese educational companies is going to continue its descending trend. The announced reform will allegedly kill the Chinese private educational sector, worth $100 billion.
