Minsheng Education Group (P Chip)

Minsheng Education Group Co Ltd. Minsheng Education Group Company Limited is an investment holding company. The Company is principally engaged in the provision of education services in China. The Company provides higher education with the focus on private education of nurturing professional. The Company operates four schools in China. The subsidiaries of the Company include Minsheng Education Development (Hong Kong) Company Limited, Minsheng Education Development Company Limited, Minsheng Education Company Limited, Minsheng Education Services Company Limited, and Chongqing Pass Education Services Co., Ltd., among others.
  • Ticker1569
  • ISINKYG6145R1065
  • ExchangeHong Kong Stock Exchange
  • SectorGeneral Retailers
  • CountryCayman Islands

Analysts

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Education - Online K12 AST regulation is just a small issue for leading K12 AST players.

Share prices of education stocks have been fluctuating lately due to the overhang from the final draft of the Private Education Promotion Law. Recently, a member of the Communist Party of China suggested the government should prevent private education companies from listing, using the VIE structure to strengthen government control and supervision of private education. However, we believe that this is a personal view and may not be the final version of the Private Education Promotion Law and the impact on existing listed education companies is limited. Maintain OVERWEIGHT.

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

MINSHENG EDUCATION (1569 HK) 3-page update – Price = US$100:-

UOB Kay Hian published this update on Minsheng Education (1569 HK) on 20th August to review the 1H19 results. Our 5-page update (including the 2-page disclaimer) contains forecasts for 2019, 2020 and 2021 for the company's key data, including net turnover, operating profit, EPS, PE ratio, PB ratio and ROE. Our slightly revised target price for Minsheng Education represents a prospective FY2020 PER of 15x and provides the justification for our maintained investment recommendation. For more information about the UOBKayHian dealing services in the Asia-Pacific region and the research on Asian com...

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Minsheng Education - 1H19: Results in line with expectations; one school consolidated, three more to go.

1H19 revenue and recurring net profit met 53% and 56% of our and consensus full-year estimates respectively. Revenue surged 66.4% yoy to Rmb526.4m, mainly driven by school consolidation while recurring net profit grew 43.6% yoy to Rmb235.4m. Recurring net margin declined 7.1ppt yoy to 44.7% on higher finance cost and lower government grants. Maintain BUY with a lower target price of HK$2.00, based on DCF valuation, implying 15x 2020 PE.

UOB
Carol Dou Xiao Qin ...
  • Charles Wong Kok Min
  • Joyce Chan Pui Lai
  • Julia Cheung Pui Man
  • Julia Pan Mengyao
  • Lee Yuk Kei
  • Michael Cheung Ho Bun
  • Oscar Jiang
  • Robin Yuen

Greater China Daily: Tuesday, August 20, 2019

KEY HIGHLIGHTS CHINA Results CSPC Pharmaceutical Group (1093HK/BUY/HK$12.96/Target: HK$17.00) 1H19: Earnings grew strongly by 24.8% yoy; easing policy pressure. Inspur International (596 HK/BUY/HK$3.77/Target: HK$5.25) 1H19: Core profit in line; resilient growth from cloud service business. Minsheng Education (1569 HK/BUY/HK$1.35/Target: HK$2.00) 1H19: Results in line with expectations; one school consolidated, three more to go. Tongcheng-eLong (780 HK/BUY/HK$12.32/Target: HK$20.00) 2Q19: Strong GMV growth, bottom line beat on better operating efficiency. HONG KONG Update Ausnutria D...

UOB
Arandi Ariantara ...
  • Carol Dou Xiao Qin
  • Charles Wong Kok Min
  • Jacquelyn Yow Hui Li
  • Julia Cheung Pui Man
  • Julia Pan Mengyao
  • Kader Farhan Bin Kader Ridzwan
  • Kowit Pongwinyoo
  • Lee Yuk Kei
  • Leow Huey Chuen
  • Michael Cheung Ho Bun
  • Oscar Jiang
  • Robin Yuen
  • Singapore Research Team
  • Thunya Sutavepramochanon
  • Vincent Khoo Boo Aik

Regional Morning Notes - Tuesday, August 20, 2019

CHINA Results CSPC Pharmaceutical Group (1093HK/BUY/HK$12.96/Target: HK$17.00): 1H19: Earnings grew strongly by 24.8% yoy; easing policy pressure. Inspur International (596 HK/BUY/HK$3.77/Target: HK$5.25): 1H19: Core profit in line; resilient growth from cloud service business. Minsheng Education (1569 HK/BUY/HK$1.35/Target: HK$2.00): 1H19: Results in line with expectations; one school consolidated, three more to go. Tongcheng-eLong (780 HK/BUY/HK$12.32/Target: HK$20.00): 2Q19: Strong GMV growth, bottom line beat on better operating efficiency. HONG KONG Update Ausnutria Dairy (1717 HK/BUY/HK$...

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

MINSHENG EDUCATION (1569 HK) 3-page update – Price = US$100:-

UOB Kay Hian published this update on Minsheng Education (1569 HK) on 20th August to review the 1H19 results. Our 5-page update (including the 2-page disclaimer) contains forecasts for 2019, 2020 and 2021 for the company's key data, including net turnover, operating profit, EPS, PE ratio, PB ratio and ROE. Our slightly revised target price for Minsheng Education represents a prospective FY2020 PER of 15x and provides the justification for our maintained investment recommendation. For more information about the UOBKayHian dealing services in the Asia-Pacific region and the research on Asian com...

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Minsheng Education - 1H19: Results in line with expectations; one school consolidated, three more to go.

1H19 revenue and recurring net profit met 53% and 56% of our and consensus full-year estimates respectively. Revenue surged 66.4% yoy to Rmb526.4m, mainly driven by school consolidation while recurring net profit grew 43.6% yoy to Rmb235.4m. Recurring net margin declined 7.1ppt yoy to 44.7% on higher finance cost and lower government grants. Maintain BUY with a lower target price of HK$2.00, based on DCF valuation, implying 15x 2020 PE.

UOB
Arandi Ariantara ...
  • Carol Dou Xiao Qin
  • Charles Wong Kok Min
  • Jacquelyn Yow Hui Li
  • Julia Cheung Pui Man
  • Julia Pan Mengyao
  • Kader Farhan Bin Kader Ridzwan
  • Kowit Pongwinyoo
  • Lee Yuk Kei
  • Leow Huey Chuen
  • Michael Cheung Ho Bun
  • Oscar Jiang
  • Robin Yuen
  • Singapore Research Team
  • Thunya Sutavepramochanon
  • Vincent Khoo Boo Aik

Regional Morning Notes - Tuesday, August 20, 2019

CHINA Results CSPC Pharmaceutical Group (1093HK/BUY/HK$12.96/Target: HK$17.00): 1H19: Earnings grew strongly by 24.8% yoy; easing policy pressure. Inspur International (596 HK/BUY/HK$3.77/Target: HK$5.25): 1H19: Core profit in line; resilient growth from cloud service business. Minsheng Education (1569 HK/BUY/HK$1.35/Target: HK$2.00): 1H19: Results in line with expectations; one school consolidated, three more to go. Tongcheng-eLong (780 HK/BUY/HK$12.32/Target: HK$20.00): 2Q19: Strong GMV growth, bottom line beat on better operating efficiency. HONG KONG Update Ausnutria Dairy (1717 HK/BUY/HK$...

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Minsheng Education - Multiple growth drivers remain.

We met with Minsheng and remain positive on its growth prospects. We see healthy organic growth from its Dianchi College and Chongqing College, and consolidated growth from its acquired schools, especially Shandong College and Anhui Wonder University. Management guided 2019 revenue to grow 56% yoy to Rmb950m-1,000m and bottom line to grow 25% to Rmb430m-450m. Maintain BUY and target price of HK$2.50.

UOB
Charles Wong Kok Min ...
  • Daisy Chen
  • Johnny Yum Chung Man
  • Julia Pan Mengyao
  • Julia Cheung Pui Man
  • K Ajith
  • Kader Farhan Bin Kader Ridzwan
  • Ken Lee
  • Lee Yuk Kei
  • Napat Vorajanyavong
  • Robin Yuen
  • Stevanus Juanda

Regional Morning Notes - Friday, March 29, 2019

CHINA Sector Automobile: 2019 EV subsidies slashed by 60-80%. Cut target prices of BYD, Yutong and CATL to HK$22.00, Rmb7.00 and Rmb40.00 respectively. Results China Communication Services (552 HK/BUY/HK$7.28/Target: HK$9.19): 2018: Results in line; benefits from telecom capex rebound. China Mengniu Dairy (2319 HK/BUY/HK$27.95/Target: HK$33.00): 2018: Results in line; 2019 outlook reassuring. Update Minsheng Education (1569 HK/BUY/HK$1.70/Target: HK$2.50): Multiple growth drivers remain. INDONESIA Results H.M. Sampoerna (HMSP IJ/BUY/Rp3,780/Target: Rp4,600): 4Q18: In line with street expecta...

UOB
Carol Dou Xiao Qin ...
  • Charles Wong Kok Min
  • Joyce Chan Pui Lai
  • Julia Cheung Pui Man
  • Julia Pan Mengyao
  • Lee Yuk Kei
  • Michael Cheung Ho Bun
  • Oscar Jiang
  • Robin Yuen

Greater China Daily: Tuesday, August 20, 2019

KEY HIGHLIGHTS CHINA Results CSPC Pharmaceutical Group (1093HK/BUY/HK$12.96/Target: HK$17.00) 1H19: Earnings grew strongly by 24.8% yoy; easing policy pressure. Inspur International (596 HK/BUY/HK$3.77/Target: HK$5.25) 1H19: Core profit in line; resilient growth from cloud service business. Minsheng Education (1569 HK/BUY/HK$1.35/Target: HK$2.00) 1H19: Results in line with expectations; one school consolidated, three more to go. Tongcheng-eLong (780 HK/BUY/HK$12.32/Target: HK$20.00) 2Q19: Strong GMV growth, bottom line beat on better operating efficiency. HONG KONG Update Ausnutria D...

UOB
Charles Wong Kok Min ...
  • Daisy Chen
  • Johnny Yum Chung Man
  • Joyce Chan Pui Lai
  • Julia Pan Mengyao
  • Julia Cheung Pui Man
  • K Ajith
  • Ken Lee
  • Lee Yuk Kei
  • Robin Yuen
  • Tham Mun Hon

Greater China Daily: Friday, March, 29, 2019

KEY HIGHLIGHTS CHINA Economics The Big Picture Not out of the woods. Sector Automobile 2019 EV subsidies slashed by 60-80%. Cut target prices of BYD, Yutong and CATL to HK$22.00, Rmb7.00 and Rmb40.00 respectively. Results Beijing Capital International Airport (694 HK/SELL/HK$7.40/Target: HK$6.70) 2018: Results In Line But Lower Earnings From Traffic Diversion Is Inevitable BYD Company (1211 HK/SELL/HK$47.10/Target: HK$22.00) 4Q18: Earnings and 1Q19 profit guidance miss estimates; cut target price from HK$26.00 to HK$22.00 on bigger-than-expected subsidy cuts. China Communication S...

UOB
Charles Wong Kok Min ...
  • Joyce Chan Pui Lai
  • Julia Pan Mengyao
  • Shaun Tan

Greater China Daily: Monday, March, 18, 2019

KEY HIGHLIGHTS CHINA Sector Education Better options in other sub segments than K12 school operators. Results Minsheng Education (1569 HK/BUY/HK$1.84/Target: HK$2.50) 2018: Results in line; one more acquisition announced. HONG KONG Results Kerry Properties (683 HK/HOLD/HK$31.95/Target: HK$31.30) 2018: Below expectations; unexciting guidance. TRADERS’ CORNER Sinopec Engineering (2386 HK): Trading Buy Range Asia Cement (743 HK): Trading Sell Range

UOB
Charles Wong Kok Min ...
  • Daisy Chen
  • Johnny Yum Chung Man
  • Joyce Chan Pui Lai
  • Julia Cheung Pui Man
  • Julia Pan Mengyao
  • Ken Lee
  • Lee Yuk Kei
  • Robin Yuen

Greater China Daily: Wednesday, March, 13, 2019

KEY HIGHLIGHTS CHINA Sector Education Solid higher education segment growth ahead, amid favourable policies. Upgrade to OVERWEIGHT. Results Nexteer Automotive Group (1316 HK/BUY/HK$9.97/Target: HK$12.00) 2018: Core net profit grows 18% yoy, in line; upgrade from HOLD to BUY. TK Group (2283 HK/BUY/HK$4.47/Target: HK$5.40) 2018: Earnings miss on margin squeeze. Xtep (1368 HK/BUY/HK$5.30/Target: HK$6.30) 2018: Strong results with growth plans revealed. Upgrade to BUY. TRADERS’ CORNER Xiaomi-W (1810 HK): Trading Buy Range CRRC (1766 HK): Trading Buy Range

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Education - Online K12 AST regulation is just a small issue for leading K12 AST players.

Share prices of education stocks have been fluctuating lately due to the overhang from the final draft of the Private Education Promotion Law. Recently, a member of the Communist Party of China suggested the government should prevent private education companies from listing, using the VIE structure to strengthen government control and supervision of private education. However, we believe that this is a personal view and may not be the final version of the Private Education Promotion Law and the impact on existing listed education companies is limited. Maintain OVERWEIGHT.

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Education - Online K12 AST regulations have minimal impact on leading K12 AST players.

The long anticipated online K12 regulations have finally been announced, and remove some of the regulatory overhang on the K12 AST segment. We view the regulations as mildly negative as rules on teaching hours and prepaid fee collection are slightly more stringent than offline K12 AST. Similar to management guidance, we think both leading K12 AST players will be able to meet regulatory requirements and expect strong results to be announced next week. Excluding the post-K12 segment in the education sector, we prefer EDU over TAL. Maintain OVERWEIGHT.

UOB
Julia Pan Mengyao

Education - Investors still positive on China’s education sector on solid demand.

On our recent marketing trip, investors agreed that the fundamental growth of education companies remains unchanged. However, the major concerns are the uncertainties ahead of the launch of the final draft of the Private Education Promotion Law. Our top picks are Minsheng and New Oriental. Maintain OVERWEIGHT on the sector.

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Education - Opportunity to accumulate amid policy uncertainty.

We think recent developments in vocational education are encouraging. The anticipated upgrade of Nanchang Vocational College to university status supports management’s expectation of 20-23% yoy enrolment growth in vocational education, which represents 20% of total enrolment in 2018. However, investors are concerned about the ever-pending finalisation of the private education promotion law which we believe has less impact on the post-K12 segment. Our top picks remain Minsheng and EDU. Maintain OVERWEIGHT.

UOB
Charles Wong Kok Min ...
  • Julia Pan Mengyao

Education - 2018 results wrap-up.

Major post-K12 operators reported in-line results for 2018 although gross margins were weak due to M&A activities. K12 AST players beat bottom-line estimates on the back of operating leverage from slower expansion of learning centres. For 2019, we expect stronger organic growth and further market consolidation for post-K12 operators and continued operating margin recovery for K12 AST players. We prefer EDU and Minsheng in their respective segments. Maintain OVERWEIGHT.

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