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Start-Up forum - Vocational Education Industry
Education - Vocational Training Industry
Industry Insight
It is estimated that during 2006-2010, 71m youngsters will enter the working-age population in India. India is the largest home for consumers of education services in the world. - Every year, about 0.165m students are estimated to undergo vocational training apprenticeship in state-run enterprises. The domestic vocational training market stood at Rs11.3 billion (USD250m) in 2007, which has grown at a rate of 11% over the previous year. In 2007, India’s school and college going population below the age of 20 years was 466.87m, which was 20.03% higher than China’s. India has the third largest higher education system in the world, next to China and the US. The government spending on education is close to 4.5% of the GDP. The size of the education industry is worth more than USD50 billion (2006-07). The major segments in vocational education and training business in India include the IT education and training, manufacturing (various trade related to Industrial Training Institutes) and hospitality management. IT education and training business is estimated to reach at Rs 48.96 billion in 2011-12. Based on the trends of employability in the industry, aviation management, retailing, BPO, healthcare deliveries and banking and financial sectors are the emerging segments. PPP model for improving the status of Industrial Training Institutes (ITIs) managed under the Government of India during 11th Plan Period (2007-12) has mobilised interest of some large size corporate groups engaged in manufacturing.
Source: Cygnus, Vocational Education and Training, Aug 2008
Education - Vocational Training Industry
Market size (Growth)
Market size  (2008)
Vocational and Training: $1.4 billion (10%)
Test Preparation: $1.5 billion (15%)
E-learning: $.04 billion (40%)
IT Training: $1.8 billion (40%)
Regulation
Unlike K-12 and higher education, profit-making is allowed. Recognition: Only for ITIs and polytechnics. Authority for registration: State Government. Authority for affiliation: Directorate General of Employment and Training, National Council for Vocational Training or State Council for Vocational Training.
Opportunities
Industries such as logistics, healthcare, construction, hospitality and automobiles need trained manpower. New and viable business models in technology-enabled education. 2.5 million getting vocation training annually against an estimated 85-90 million people needing it from 2008-13.
Source: Technopak
Recent Developments
Career Launcher readies university launch in 2010. NIIT University rolls out in September 2009. Everonn, a technology-enabled education player, has entered formal education; to set up colleges. Matrix Partners India invested Rs 100 crore in IIT test prep company FIITJEE. Career Point that started as a test prep outfit has recently raised Rs 50 crore in equity capital from Franklin Templeton Private Equity Strategy.
Industry Players
NIIT
STARTED IN/AS: 1981, Delhi, an IT training solutions provider (first centre in 1982)
NOW PRESENT IN: Schooling, higher education, vocational and skills training
INITIAL INVESTMENT: Rs 12 lakh
FIRST YEAR REVENUES: Rs 1 crore
REVENUES NOW: Rs 1,148 crore (FY 2008- 2009)
ENROLLMENTS IN FIRST BATCH: 99
CURRENT ENROLLMENTS: 5,00,000 at NIIT centres; 12 million across all verticals
FOOTPRINT NOW: Over 1,25,00 education centres in India, over 200 IT centres in China and 170 across the world
EXPANSION PLANS: NIIT University at Neemrana, Rajasthan, starts in Sept. ’09
FOCUS AREAS: Skills development and schools.
Career Launcher
STARTED IN/AS: 1995, Delhi,test preparation for B-schools
NOW PRESENT IN: Schooling, higher education (B-school and university), vocational and skill training and test preparation
INITIAL INVESTMENT: Rs 13,000
FIRST YEAR REVENUES: Rs 30,000
REVENUES NOW: Rs 150 crore (FY 2008- 2009)
CURRENT ENROLLMENTS: 1,10,000
FOOTPRINT NOW: 225 locations across India, UAE and the US
EXPANSION PLANS: University rollout next year; number of Bottom of Pyramid schools to go up to 100 by 2012
FOCUS AREAS: Higher education, vocational skills and K-12 with focus on low-cost education
Mahesh Tutorials
STARTED IN/AS: Mumbai, 1988, Coaching classes for higher secondary
INITIAL INVESTMENT: Rs 6 lakh
FIRST YEAR REVENUES: Broke even
REVENUES NOW: Rs 100 crore
CURRENT ENROLLMENTS: 50,000
FOOTPRINT NOW: 170 centres across India—one in Dubai
EXPANSION PLANS: To begin IIT preparatory classes and to introduce technology as a teaching aid
FOCUS AREAS: Test preparation
Source: Business Today, September 2, 2009