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    3978   KYG2121W1024

CHINA BESTSTUDY EDUCATION GROUP

(3978)
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China Tutoring Firms Expect Material Adverse Impact From New Regulations

07/25/2021 | 06:16pm EDT

By P.R. Venkat

Chinese education companies said that Beijing's new regulations that restrict after-school tutoring services will have an adverse material impact on their operations and financial results.

The high-level policy directives require institutions that provide after-school tutoring for academic subjects in China's compulsory education system to be registered as non-profit organizations. Foreign ownership in after-school tutoring institutions is prohibited and firms that have foreign ownership would need to rectify the situation.

U.S.-listed New Oriental Education & Technology Group said Monday that is "considering appropriate compliance measures to be taken, and expects such measures to have material adverse impact on its after-school tutoring services."

New Oriental Education's share price fell 54% in New York and was down 41% in Hong Kong on Friday. TAL Education Group, also listed on the NYSE, lost 71%.

TAL said Sunday that the compliance measures to be taken by the company will have "material adverse impact."

Dashan Education Holdings said that it was still unclear on how the local authorities will interpret and implement the policy.

"The management of the group believes that with the proper adjusted business model for its existing businesses and the expanded businesses, the group will be able to meet the challenges posed by the new policy," it said.

China Beststudy Education Group said that the impact on the group is still unclear and that it was in communication with regulatory authorities and would make appropriate adjustments to its business.

In May, a top-level meeting chaired by Chinese President Xi Jinping said that the government should step up supervision of the sector and crack down on irregularities in fee structure, strengthen regulation of prepaid tuition and ban arbitrary funding operations

Last month, the Chinese market regulator fined 15 tutoring companies a total of $5.7 million for false advertising and fraudulent pricing. Separately, a new office was set up in the Education Ministry to oversee the tutoring industry.

Write to P.R. Venkat at venkat.pr@wsj.com

(END) Dow Jones Newswires

07-25-21 2016ET

Stocks mentioned in the article
ChangeLast1st jan.
CHINA BESTSTUDY EDUCATION GROUP 3.57% 0.58 End-of-day quote.-80.67%
DASHAN EDUCATION HOLDINGS LIMITED 4.26% 0.49 End-of-day quote.-54.63%
NEW ORIENTAL EDUCATION & TECHNOLOGY GROUP INC. 4.74% 1.99 Delayed Quote.-89.29%
TAL EDUCATION GROUP 7.14% 4.8 Delayed Quote.-93.29%
All news about CHINA BESTSTUDY EDUCATION GROUP
09/20CHINA BESTSTUDY EDUCATION GROUP(SEHK : 3978) dropped from S&P Global BMI Index
CI
09/01CHINA BESTSTUDY EDUCATION : H1 Profit Slumps 89% on Impairment Provisions
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08/31China Beststudy Education Group Reports Earnings Results for the Half Year Ended June 3..
CI
08/05MARKET CHATTER : Beijing to Fast-Track Application of New Tutoring Rules
MT
07/29China Starts Crackdown on School Teachers Offering After-School Tutoring Services
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07/26Hong Kong Stocks Drop to Seven-Month Low; Tutoring Companies Suffer Heavy Sell-off
MT
07/26China Unveils Sweeping Education Overhaul, Prompting Selloff of Tutoring Stocks
MT
07/26China's new private tutoring rules put billions of dollars at stake
RE
07/26CHINA BESTSTUDY EDUCATION : Shares Plunge 39% on Beijing's Clampdown on Tutoring Sector
MT
07/25China's private education firms brace for hit from new rules
RE
More news
Financials
Sales 2021 2 101 M 325 M 325 M
Net income 2021 164 M 25,4 M 25,4 M
Net Debt 2021 - - -
P/E ratio 2021 2,32x
Yield 2021 -
Capitalization 358 M 55,4 M 55,4 M
Capi. / Sales 2021 0,17x
Capi. / Sales 2022 0,14x
Nbr of Employees 7 759
Free-Float 41,3%
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Number of Analysts 1
Last Close Price 0,48 CNY
Average target price 3,03 CNY
Spread / Average Target 530%
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Managers and Directors
Jun Jing Tang Chairman & Chief Executive Officer
Hong Zhang Zheng Chief Financial Officer
Peng Xue Independent Non-Executive Director
Yu Long Independent Non-Executive Director
Ying Min Wu Independent Non-Executive Director