Education sector undergoing paradigm shift: Rajesh Jain

In a conversation with ET Now, Rajesh Jain, market strategist, talks about the outlook of education stocks.

Everonn Education has said that it is open to selling stake. What could be the rationale here?

A lot of things are going right for the education space, whether you look at Aptech, Everonn or Educomp. The education sector is facing two drivers. One is the change in the paradigm of pedagogy, the very basic methods by which you teachings are undergoing a transformation and which is where players like Educomp and HCL Tech come in. And the other is the Sarva Shiksha Abhiyan of the government, which is awarding, shall we say, rights for various geographies to various players and there are a number of educationists who are entering this field.

It is this twin combination of volume driver plus the value addition that will happen in the education space, in addition to the huge scope for IT education, which is actually driving Aptech, plus the possibility of going beyond Indian frontiers, which is exciting the entire education space. There is also a related development in the sense that the university education and the school education has really been opened to the private sector. So, I would not be surprised if you have some public offers coming in from bodies that manage such places.

The education space is in a state of transformation. There is a lot of money to be made in addition to really adding value and giving back to society. This development whereby a promoter of an infrastructure group takes a big stake in an education company really signals a paradigm shift. That's the way I would look at it. I have also worked in a couple of projects where particularly the Sarva Shiksha Abhiyan is opening up a lot of earnings potential for education-driven companies.