How is Education Sector Placed With Online Learning TrendAmidst Virus Threat; Look at IEL, GEM, 3PL

  • Mar 31, 2020 AEDT
  • Team Kalkine
How is Education Sector Placed With Online Learning TrendAmidst Virus Threat; Look at IEL, GEM, 3PL

In the world exemplified by change and innovations, the human sometimes tends to grip the chord of past, withholding the shreds of the ancient ethos that somehow yet seems to find space in our beliefs. The revered association to some past practices that we are reluctant to abandon as we tread along the new path erected by technology. The institution formed around the long-practised tradition of face-to-face learning seems to be deep-rooted with our expectations as the human society evades various possibilities that could rip out the custom. 

Although as the world continues its journey towards convenience and advancement, it has adopted many online study support tools. The classrooms yet remain the primary centre for learning.

However, it appears that the current scenario is favouring the new mode of learning as the detrimental coronavirus provides a firm nudge towards work from home and the online study system. The travel bans preventing thousands of students from returning to their campus, followed by intense inculcation of the social distancing practice amidst the lockdown has led to the surge in demand for online tutorials and classes.

According to UNESCO states, more than 100 countries have shut down their their educational universities/schools, impacting half of the world’s students.

Amidst the Covid-19 outbreak, every sector seems to be grappled by its own set of difficulties. While some are more overwhelmed by the disruption in the supply chain, many industries are struggling prominently due to the swift change in the demand pattern.

As many turns towards the new culture of ‘Work from Home’, the universities also adopt the same element in a different fashion. The education sector being the forbearer of the infliction even in the initial stages of Covid-19 seems to utilising the technology to facilitate the web conferencing based face-to-face tutorials, online assessments and lectures. 

Despite the varying efforts, the uncertainty clouding the future demand and supply of the education services remained as one of the prominent governing factors that serve to loosen investor’s foothold during the withering situation.

As the headwinds continue to restrain the momentum of the world economy, the sell-off continued, and the markets plunged. At the same time in the midst of such a grim situation, many investors seem to grasp some final bits of hope as they eye the new developments as a silver lining in the education industry. 

Let us look at the few stocks to inductively ascertain how is the education sector placed amidst online education and learning from home.

IDP Education Ltd (ASX: IEL)

Engaged in the international education services, IDP Education Ltd (ASX: IEL) provides various services that are catered to enabling the students for studying abroad. The services range from informational services such as course advice and counselling to visa application and pre-departure support. Moving along the line of the innovation, the company has integrated digital transformation through global technology platform and has established Digital Campus in Chennai, India. The adoption of the computer-delivered IELTS alongside the investment in technology infrastructure is utilised for innovation in the overall customer experience. 

In latest updated, IEL deferred the payment of interim dividend to 24 September 2020, which was earlier scheduled for 27 March 2020 in the wake of COVID-19 threat. However, the company is optimistic of long term drivers of international education

The stock is on voluntary suspension pending the release of update pertaining to COVID-19 impact on business. The stock last traded at $11.56 on 25 March 2020.

G8 Education Limited (ASX: GEM)

The Australian G8 Education Limited (ASX: GEM) provides educational and quality care services through utilising its different brands, including Pelicans, Jellybeans and The Learning Sanctuary engaged in delivering evidence-based learning to children under the age of five years. 

The company has opened all its centres for supporting the families amidst the Covid-19 outbreak. The company also highlights that for a child’s up to 42 absence days, CCS can be paid per financial year without the requisite for families to provide documentation.

All the centres are also offering a high level of protection with Zoono Microbe Shield and Zoono Hand Sanitiser, that is ultra-gentle and dermatologically tested, containing no dangerous chemicals. 

GEM stock traded at $0.825 up 17.9% on 31 March 2020 (1:35 PM AEDT). 

3P Learning Limited (ASX: 3PL)

Invested in online education, the Australia-based 3P Learning Limited (ASX: 3PL) provides a suite of learning resources that are catered to families as well as schools. The education primarily covers spelling, literacy and mathematics across the Americas, EMEA and APAC regions. The products include Matheletics, Reading eggs, Readiwriter, Mathseeds, Stemscope Science and WordFlyers. 

 In its response to the mass school closure amidst the outbreak, the company has launched the Digital Accelerator Support Package that not only provides edtech solutions but also assists in setting up the school or class. 

3PL shares seems to be basking in the growing popularity of the online learning trends amidst the outbreak,generating a return of ~16% in the past one month. 3PL stock traded at $0.900, up 12.5% on 31 March 2020 (1:35 PM AEDT). 

COVID-19 has brought in challenges for the education sector with shutting down of schools/colleges across the globe, while myriad of opportunities for remote learning needs to be considered viz-a-viz security breaches and privacy issues.               


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