career point ltd share price Management discussions


The year 2023 witnessed a mixed global economic performance. After the COV1D-19 pandemic disruptions, economies around the world displayed signs of recovery, but the pace varied across regions. Despite the challenges of high Inflation rates, geo-political uncertainties, and the lingering Impacts of the pandemic; global GDP growth showed moderate improvement, bolstered by increased international trade and advanced technologies.

Among these, Indian economy is on the cusp of a tectonic shift. As the country take on the leadership of G20, India Is emerging a shining star In the world economy, The expected growth for current fiscal for Indian economy is more than 6% compared to about 3% global GDP growth. Indias economy has been demonstrating remarkable resilience and exhibiting strong GDP growth, primarily driven by a rebound in consumer demand, emerging investment opportunities, and several government Initiatives Including Make In India, Start up India, PL), Digital India, Skill India, NEP-2020etc

Moving the discussion specific to education sector, India is one of the largest education markets globally with approximately 300 million students. The Indian education system comprises 1 million teachers, l.S million schools, 1000+ universities and 35000+ colleges. The growth prospects can be envisaged with the figures that India posses 600 million of population below 24 years and adding 10 million workforce every year.

NEP (New Education Policy) has further opened a new Window dT opportunities across the education verticals l.e. school education, higher education, vocation education. Regulatory agencies are also changing their functioning accordingly. Various global education players are reaching out in India with their interest. At the same time, many countries are approaching Indian premier education Institutions to set up their campuses there.

An extended perseverance and tenacity paved way to sow the seeds of quality ecucation in India. The educational institutions need to design their academic pedagogy that not only provides the conceptual knowledge but also give application of these concepts. Below statistics of key competitive examinations in India Indicate the importance of result oriented teaching methodologies in highly demanding education environment at present.

The number of students registered In CUET Increased from L3 million in year 2022 to 1.5 million in year 2023. Numberof participant universities further increased to 249 from 90 in previous year. The processes are also Improved. The date of first exam for CUET-2022 was 15 Jul 2022. Whilst, the result declaration date of CUET-2023 is 15 Jul 2073 The exam was conducted in 9 phases in 13 languages across 295 cities including 23 overseas locations.

CUET 2023

Registered Appeared

Male

803,647 602,028

Female

696,134 513,978

Transgender

15 12

Total

1,499,796 1,116,018

General

678,478 513,155

EWS

65,206 53,219

OBC

499,126 380,7S4

SC

150,699 115,215

ST

106,287 53,645

UPSC (Union Public Service Commission) examination, one of the worlds toughest exam, has selection ratio of less than 0.2%. Total 5.7 lakh candidates appeared for the preliminary exam conducted on 5 Jun 7,022 and finally 1022 candidates selected in the result declared In May 2023.

For the education players, the ability to adapt and capitalize on emerging opportunities, along with addressing persistent challenges, will be crucial in shaping their trajectory in the coming years. The management must remain vigilant and agile in navigating the ever-changing industry landscape and fostering an Inclusive growth path for all the stakeholders

Moving the discussion to companys businesses. Career Points unwavering commitment to excellence and innovation has allowed the company to flourish in the education sector One of our key

Knowledge Capsule

PGI - School Education Index: The Performance Grading Index (PGI) is a comprehensive analysis of school education in the states and union territories while grading on a set of 70 parameters, grouped under five categories - learning outcomes and quality, access, Infrastructure and facilities, equity and governance processes. The PGI objective is to promote evidence-based policy making and highlighting course correction to undertake multi-pronged interventions that will bring about the optimal education outcomes

UPSC-2022

Candidates

Applied

1.135,697

Appeared in Pre

573,735

Qualified for Mains

13,090

Qualified for Interview

2,529

Selected

1,022

IAS

180

IPS

38

IPS

200

Group A

473

Group B

131

strengths lies in our dedicated team of educators and professionals, who continuously strive to create an enriching and dynamic learning environment for students across Career Point Institutions.

CPi3n5 believe that quality education is a catalyst for empowering individuals and fostering a brighter future for society as a whole Remarkable results of Career Point students in various examinations and outstanding placement records of our higher education students reflect our ability to deliver result oriented solutions to meet the evolving needs of our customers. Our diverse portfolio of products and services, coupled with a customer-centric approach, hasenabled us to gain a competitive edge in the market.

Throughout the year 2022-23, Career Point expanded its reach and impact, extending the educational services to new markets and communities. Company managements efforts to embrace emerging technologies and adapt to changing educational paradigms have enabled Career Point to stay ahead of the curve and enhanced the learning experiences of the students.

The ever-evolving digital landscape has presented us with new avenues for growth and outreach, and we are fully embracing this transformative era to create a seamless blend of traditional and digital learning platforms. In addition to expanding our digital initiatives, we have made significant strides in our physical network through franchlseecentersacrossthenatlon.

Career Point serves the students through following 6 key business divisions:

1.Test-Prop /Tutorial Services:

Website: www.careerpoint.ac.in

Career Points prepares students for various competitive examinations through New Edge Classroom Coaching. Under the Test-Prep division, the company offers tutorial services for JEE (Joint Entrance Examination), MEET (National Eligibility cum Entrance Test) and many other examinations through the following modes:

Company operated branches;

Franchisee centers;

School integrated programs;

Distance learningsolutions.

Career Points result oriented coaching methodology is scientifically designed and time-tested. It is step by step process to realize the best potential of a candidate for a successful career. Post Covld. all the classroom product offerings also have digital learning supports to provide benefits of hybrid learning. The division has trust of more than <100,000 students and parents over the last 30 years Including 18,600 HTians, 21,000 Doctors, and 151,700 Engineers.

The key important update of this period for test-prep division was the transformation of the business operations from educational service provider to an educational product division focusing on the development of innovative and dynamic educational products.This new business model offers the company numerous short term and long-term benefits, such as foster expansion of its product lines, easier scalability, and better quality offenrgs. The early reflections of this are very promising. Numbers of centers are Increased by 2.75x In the academic session along with an exponential growth indivisional financials.

2. e-Leaming / Digital Education

Website: www.ecareerpoInLcom/ eCareerPoInt android app on Playstore

With 2500+ Hours of Video Lectures, 25,0GO Pages of e-Study Material, 125,000+ Questions In Digital Question Bank, Career Points e-learning division is having trust of 2.5 Lakhs of existing subscribers. The courses at. eCareerPoInt provide quality education to students at their own convenience with affordable cost through different technology formats of Live Tutoring, Recoded Video Courses and Online Assessments etc. One of the USP of Career Points eLearning products is 2-way audio and video communication in a live class (not :ust chat) at cCa reerPoints Mobile App as well as Web mode delivery.

Career Point oelieves that technology Including Artificial Intelligence is a tool to amplify human intelligence, creativity and ingenuity.

CPlive/OnlineClasses: Live interactive regu for classes by expert faculties on App and Web with premium services of Recorded Lectures, Study Material Package, Doubt Sessions etc.

CP eTutor / Recorded Courses: Video lectures accessible anytime on any device through App or USB drives/ Memory Cards with offlineS online support for doubt sessions.

CP eTest / Online Assessments: 247acces3 to online test series with realtime exam experience, detailed solution of the test and section wise analysis. It also offers all India ranking, comparison with toppers and time management report etc.

Vedam Learning: One to One live tutoring with 2-way interactions for personalized learning.

3. School Education:

The Company offers services to K-12 Schools in multiple geographies. These services include auxiliary education services as well as Infrastructure services. While laying a very strong foundation for

Knowledge Capsule

NCrF-National Credit Framework: National Credit Framework (NCrf) is an Inclusive umbrella framework to seamlessly integrate the academic credits earned through school education, higher education, and vocational & skill education. It enables entry and re-entry of students from the vocational stream to general education and vice-versa.

future at early age. Career Point empowers students on their holistic development. The residential campuses under the brand Career Point GurukuP are positioned as premier Integrated schools with best of the academics, sport and extracurricular.

Career Point Gurukuls where the company currently provides its services Include:

Career Point Gurukul, Kota - Residential school {www.cpgurukul.com}

Career Point Gurukul. Mohali (Punjab) - Residential school (www.cpmohati.in)

Career Point Gurukul.Rajsamand (Rajasthan)- Residential school {www.cprajsamand.ln)

The day-boarding school campuses serviced by the company include:

Career Point World School, Jodhpur (Rajasthan) - Da/ School (www.cpwsjodhpur.com)

Global Public School, Kota (Rajasthan) - Day School {Arww.globalpuollcschcol.com)

In session 2022-23, the students 3t schools powered by Career Point flourished on all fronts i.e. academics, sports, life-skills and extracurricular. The schools provide students the knowledge, skills and attitude that one needs to succeed in life and career. They offer a distinctive way of education to students who perform beyond academics and are ready to act analytically. Intuitively, ethically and decisively, in any environment. The schools vigorously work to integrate the future need of education that equips the students t.o become a valuable asset of the society.

4. University Education:

Career Point provides services to Universities under Its higher education division. These services include auxiliary education services 3S well as financial services. The course offerings by these Universities varies from professional development to under-grad, post-grad degree-awarding courses In various streams Including Engineering & Technology, Managements Commerce Studies,

Computer Applications, Law, Pharmacy, Applied Sciences, Hotel Management, Vocational Studies etc.

Career Point University. Kota (Rajasthan) www.cpur.in

Career Point University, Hamirpur (Himachal Pradesh) www.cpuh.in

Courses offered by Career Point Universities

Engineering & Technology

B. Tech, M. Tech and PhD.

Computer Applications

BCA, MCA, PGDCA

Management & Commerce

BBA, MBA, B. Com, M. Com, PGDM

Basic & Applied Sciences

B.Sc, M.Sc,, BSc-Btd

Health & Allied Sciences

ePT, MPT, BHA

Pharmacy

D. Pharma B.Pharma

Law and Governance

LLB, LLM, BA-LL6, BBA-LLB

Hotel Management

BHMCT, DIFP/DIFBS

Arts and Humanities

BA. MA. MSW. BA-Bed.

Library Sciences

B.Ub, M.Jb, MSc :Llb. Sc.J

Education Courses

BEd., MEd.

Vocational Studies

8.Voc, Polytechnic Diploma

Post PG

PhD.

Since year 2012, both the Universities are revolutionizing the higher education by continuing the fantastic achievements in the areas of academics, research, employability, entrepreneurship, extracurricular, sports, and social responsibilities. The courses at Career Point Universities are designed to provide the students rewarding qualification, practical exposure, hands-on learning, requisite expertise and desired skills fora successful career.

Below are some of the recent regulatory updates and policy initatives from UGC (University Grant Commission) that offer our University education division a large potential of value addition and growth opportunities:

Twinning, Joint and Dual degree course programs

Internationalization of Indian Higher Education

E-degree regulations

Minimum standards & procedure for award of PhD degrees

University-Industry linkage guide lines

ProfessorofPraaiceasIndustryexperts

IDP- Institutional Development Plan

FYUP-Four Year Undergraduate Programs

NRF(National Research Foundation) bill 2023

IKS-Indian Knowledge System

ABC-Academic Bank of Credit

NHEQF-National Higher Education Qualification Framework

5. Skill Development- Career Point Skill Division:

Website: www.cpisd.in

Career Point Institute of Skill Development (CPiSD) has been set-up to fulfill the growing need in India for skilled manpower across sectors and narrow the existing gap between demand and supply of employment oriented education and tralning.CPISD has setup learning centers in rural and urban locations to provide employability skills aligned to industry needs which enhance youth employability and proves business productivity.

CPISD empowers the trainees through the power of skill development. The division offers skill development courses in multiple sectors. However, considering the sustained shift in the composite of Indian economy from agriculture to manufacturing and now towards services: CPISD algns its course offerings accordngly. The division ensures that the students pick up essential career skills to enhance their employability and entrepreneurship skills.

During the period 2022-23, CPISD trained students under following central and state government schemes:

National Urban Livelihood Mission

SeekhoaurKamao project

Khadi Gramodyog Vikas Yojana

Hunarse RozgarTak training program

National Skill Development Corporations partnership

National Institute of Agricultural Extension Management (MANAGE)

6. Early Childhood Education-Global Kids Website: v/ww.giobalkidsworld. In Academic Pedagogy: http://bit.do/gkindia

With a mission to help each child to realize the breath of her talent; the unlimited power of mind & Imagination and strength of spirit to ensure all round development and enabling each child to cope with ever-growmg chaliengesof life, Career Point provides early childhood education through chain of Play-schools under brand Global Kids.

With child-centered approach, Global Kids focuses not only on developing academic skills, but also Intellectual, emotional, linguistic, physical, social and moral skills that will ensure life-long success for the new generation.

Financials

In financial year 2022-23, income from operations y/as recorded rupees S5.4 crores on consol basis (y-o-y +57.4%) and rupees 51.9 crores at standalone level (y-o-y: +76.9%), The growth in operating Income is a result of increased enrollments across franchisee centers, residential campus and formal education division, The company also witnessed a significant growth In sale of study material fuelled by e- leamlng products and export sale of the books. Total revenue, including other income, wasreported of rupees 91.2 crores on consol basis and rupees 55.7 croresat standalone level.

EBITDA (Including other income) of rupees 21.0 crores on consolidate numbers; and rupees 33.6 crores on standalone resulted EBITDA Margin o 23.1% and 60.1%, respectively. A decline In EBITDA at consol level was due to one-off provision in subsidiary related to a loan account Impacted negatively due to Covidl9 pandemic. Though, in the improving scenar o for the businesses of subsidiarys borrower, the company management is optimistic in recovery of this due for which provision has been made to meet all NBFC compliances.

Net profit excluding one-off provision results at rupees 41.57 crores and EPS (Earning per share) of rupees 7.2.85 on consolidated basis. At standalone level, the company reported net income of rupees 22.2 croresand EPS of rupees 12.2 with remarkable year-on-year growth

of 106%.The increase validates the new strategies being implemented post pandemic - especially the transition from an "Educational Service Provider" to an "Educational Product Company" As on 31 March 2023, Net worth of the company was rupees480 crores and Book value per share was rupees 264.

Key Ratios (Consolidated Financials)

FY2021-22 FY2022-23

Revenue from Operations Growth (%)

10.2% 57.4%

EBIT Margin

51.9% 18.5%

Net Profit Margin

38.5% 13.3%

Adjusted Met Profit Margin

38.5% 45.6%

Debtors Turnover (times)

1.6 4.6

Inventory Turnover (times)

23.0 45.8

Current Ratio (times)

18.0 14.0

Debt Equity Ratio (times)

0.05 0.04

Return on Net Worth {%)

4.9% 2.4%

Adjusted Return on Net Worth (%)

4.9% 8.7%

Adjusted the effect of one off provision In NBFC subsidiary

Revenue from operations increased with improved enrollments in both Informal and formal education division through a bigger network of study centers and new courses. An Improvement in enrollments at residential campuses and higher sale of study materials also fuelled the revenue growth during (he year 2022-23. Despite a marginal Increase In operating expenses, EBIT (Earnings Before Interest and Taxes) at standalone level was significantly better than previous year because of the Improved revenue.

At consolidate level, Srajan Capital Limited, a subsidiary of the company, boosed a provision of rupees 39.58 crores related to one borrowers account Adjusting the effect of this one-off provision, which the company management is hopeful to recover in due course of time, company clocked healthy operating and net profits.Net profit excluding one-off provision came at rupees 41.S7 crores with net margin of 45.6% against rupees 22.9 crores of net profit and 38.5%netmargininpreviousfinancialyear{FY2021-22)

Debtors turnover ratio and Inventory turnover ratio were increaseddue toincrease in revenue Current ratio is declined slightly from 18x to 14x on the account of reduced sundry debtors. Oebt Equity ratio at 0.04 Is Improved slightly and continued to be very superior. Return on Net Worth has been improved on the account of higher revenue despite a one-off provision in the period under review.

Enrollments

FY2Q13 FY2014 FY2015 FY20.16 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023

Total

29,398 24,120 27,366 30,857 29,086 29,509 29,642 25,623 25,011 18,192 18,584

Tutorial Division

27,257 20,655 22,412 23,010 21,057 18,235 15,162 13,024 12,251 8,041 6,442

Formal Education

2,141 3,465 4,954 7,847 5,029 11,274 13,772 11,814 12,760 9,810 12,142

Pre-School

708 785 341

Tutorial Enrollments Spilt

Branches-LT CR

17,262 11,122 12,945 13,688 10,689 5,836 5,100 3,023 8,567 5.050 2,303

Branches-ST CR

2,978 1,169 1,333 1,011 625 516 121 15

Franchisees-LT CR

1,754 1,764 1,576 1,395 1,60S 2,049 3,512 3,917 1,541 1,505 3,091

French isee‘-ST CR

381 23 87 52 - 138 - 33

School Asso.

- - - 458 1,801 3,726 2,523 3,007 2,143 1,486 1,048

Distance Learning

4,882 6,577 6,470 6,406 6,337 5,970 3,906 3,029

Formal Break-up

Higher Education

741 1,642 2,327 3,455 3,738 4,822 5,706 6,505 6,203 5,803 5,123

School Education

1,400 1,823 2.627 3.372 3.451 4,142 3.752 3,688 3.429 2.882 2.544

Vocational Edu.

1,020 840 2.310 4,314 1,621 3.128 1.125 4,475

Human Resources

Career Point has demonstrated its excellence to thousands of satisfied students and their parents. All this would not be possible without the committed and passionate people of Career Point -both academic and r.on-acadcmic staff, who strive to build this a great organizat(on each and every day. They remain committed to companys ideals ol building on a strong foundation, creating a bright future and dellveringgreat value

The company continues to be very efficient in adding talent in the respective divisions. By 31 March 2023, the Company had total number of employees of 122. The number has been lower compared to previous year as the some of the new positions were fillec by internal hires and by contractual staff. Our new product business model also offers an advantage to grow with less number of human resources employed direcTly on the company payroll. We remain committed to provide an agile and collaborative environment that encourages harmony, development, pride and confidence amongst CPians.

Corporate Social Responsibility

Career Point management is proud to report that our commitment to

social responsibility remains at the core of our

values. Career Point h2s actively engaged In various community-

driven initiatives and philanthropic endeavors, ensuring that

education remains accessible to all, regardless of socio-economic

backgrounds.

We 3re particularly thrilled about the positive, impact we have made on the lives of millions of learners across geographies. Our educational programs and platforms have empowered students to achieve their full potential, thereby creating a lasting impact on society. Our passion for education continues to drive us forward, and we are committed to making a difference in the lives of many more learners in the years to come.

Furthermore, Career Point understands the imoortance of giving back.

Giving back to deserving undeserved candidates through financial support programs

Giving back to environment by several environment friendly green Initiatives

Giving back to communities through a series of projects in the area of healthcare, employment and of course, education,

Risks and Concerns

With having the business operations in different Industry segment. Career Point is exposed to variety of external and internal risks. Though the company has a robust mechanism for risk management In piace, however, complete risk avoidance on all the financial, operational and strategic objectives cannot be promised. Boards of directors and management of the company regularly review and aim to mitigate various risks related to regulatory, competition, geography, human resource, technology, legal, political etc. The company recognizes following key risks to its business operations Which may adversely affect the financial oerformance of the Company:

Regulatory risk: Any changes in regulatory norms on the Formal as well as Informal Education front may significantly Impact the investment made in education by the Company. The Company is continuously making an effort to upgrade its services, diversify delivery channels, leveraging technological advancements, expanding the product portfolio to minimize the regulatory risk, if any.

Decrease In student enrolment: With the increased competition from offline as well as online education service providers, decentralization of the students or any other reasons; the Company might face a risk of decline In student enrolments. Post Covid, many of the Ed-tech companies are also entering in to classroom coaching space. However, the Companys focused academic pedagogy and marketing strategy (which includes direct and indirect marketing) continues to attract students across its divisions of formal as well as informal education.

Cyber Security Risks: Digital content of the company is very valuable assets. This intangible repository is accessible through different modes which are exposed to the cyber security risks To mitigate the risks, Career Point constantly upgrades the appropriate security measures and creates an environment of increased risk awareness at all levels.

Pressure on margins: There could be a margin pressure due to staff costs, cost of study material, high advertising and business promotions, etc, going forward. We believe the Company has sufficient tools to counter these factors, if the same arises.

Attrition: Attrition of the key resources or team members may Impact the business. The Companys strategy for retaining talent

Involves offering competitive compensation packages, faculty training system in place for new entrants and existing faculty, along with a healthy working environment.

Non-performing Assets: Surge in Infections, new mutants, partial lockdowns, high commodity prices and global financial market volatility imparted downside risks to the growth of NBFC business of the company. To cover Itself for future credit risks, the company has provided higher provisions and write-off wherever appropriate.

Geographical concentration: The Company derives the larger share of its revenue from Kota in Rajasthan and Northern part of India. Hence, any disruption in operations, or competition at these locations could impact overall operations significantly. The Company is making a concerted effort to expand Its operations pan-India and overseas through franchisees, business associations etc and Is also boosting its Technology Offerings, Distance Learning segment etc.

Internal Controls & Systems

The Company has proper and adequate internal control systems, which ensure that all assets are safeguarded against loss from unauthorized use and all transactions are authorized, recorded and reported correctly The Management continuously reviews the internal control systems and procedures to ensure orderly and efficient conduct of business. Internal audits are regularly conducted, using external and internal resources to monitor the effectiveness of internal controls. The Company deploys a robust system of Internal control that facilitates the accurate and timely compilation of financial statements and Management reports; ensures regulatory and statutory compliance; and safeguards Investors Interests by ensuring the highest level of governance and periodical communication with investors.

M/s. BDG & Associates.. Chartered Accountants is the internal auditor of the Company, who conducts audit and submit quarterly reports to the Audit Committee. The Internal Audit process is designed to review the adequacy of internal control checks in the system and covers all significant areas of the Companys operations. The Audit Committee reviews the effectiveness of the Companys internal control system. The CEO and CFO certification provided In the CEO and CFO Certification section of the annual report further discusses the adequacy of our internal control systemsand procedures.

Outlook

As we look towards the future. Career Point management is filled with optimism and excitement. The potential for growth in the education sector is immense, and we are well-positioned to seize these opportunities Our strategic roadmap includes further expansion of the center network in test-prep division, expanding our course offerings in formal education, and forging new partnerships with like- minded organizations, all with the ultimate goal of enriching the lives of our students and contributlngto societys advancement.

We firmly believe that education Is the cornerstone of progress and development, and our relentless pursuit of knowledge and growth will continue to be the driving force behind our success. By learning from past experiences, forging strategic initiatives and striving hard to achieve customer delight; Career Point is posed fora more resilient and sustainable path to growth With a renewed sense of purpose, determination, and a collective effort of the entire Career Point family, we are confident that the best is yet to come.

Cautionary Statement

This report contains forward-looking statements, which may be identified by their use of words like plans, expects, will.

anticipates, believes, intends, projects, estimates or other words of similar meaning. All statements that address expectations or projections about the future, including but not limited to statements about the Companys strategy for growth, product deve opment, market position, expenditures and financial results, are forward- lookingstatements.

Forward looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee Thai these assumptions and expectations are accurate or will be realized The Companys actual results, performance or achievements could thus differ materially from those projected in any such forward looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events.