In the previous study of the distribution of the sub-sectors of 30 new education companies in the New Third Board, the author has found a clear trend, that is, more enterprises choose to directly open early childhood education institutions to provide educational services. Specific to the 17 A-share companies within the scope of this study, they also showed similar transformation biases. Today, the author will take you to see the seven key words of these 17 transformation companies. Keyword 1: Kindergarten According to the depth of intervention enterprises involved in the early childhood education industry, the author divides 17 A-share companies into the following categories: Early childhood investment incubation (Sunshine City); Early childhood education products, including toys, courses and children's books (Dadi Media, Changjiang Media); Informatization platform for online auxiliary teaching; Training for young teachers (such as Weichuang shares); An offline kindergarten or early education institution; Early childhood education programs, such as preschool-educated preschool TV or online programs (Huang's Group). In terms of quantity , like the 30 preschool education companies that I studied before, the number of companies that have transformed into kindergartens, early education institutions, and early childhood education is undoubtedly the largest, with 10 in total. As you can see from Chart 1, most companies span more than one segment. For example, the Love Cube of Changjiang Media has both early childhood investment and consulting services, as well as preschool toys and courses, as well as preschool cloud platforms and chain kindergartens. However, there are also companies involved in only one segment of the industry. For example, Senma apparel only invests in the early education brand institutions FasTracKids and FasTracEnglish. Its main business is still the clothing industry, and there is not much involvement in the field of early education. On the other hand, the largest number of companies entering kindergartens, early education institutions and educational information industry , 10 out of 17 companies have invested in these two industries. This may be because with the opening of the policy, the number of children has increased significantly, and the demand for kindergartens and early education institutions has become increasingly strong. In the Internet era, the informationization of early childhood education is also the trend of the times. There are four companies entering the early childhood education industry, and they are all traditional publishing institutions. They are Phoenix Media, Dadi Media, Times Publishing and Changjiang Media. In terms of early childhood education, although many companies have set up education industry funds to invest in the education industry, only Sunshine City has established Sunshine Education Investment Management Co., Ltd. to specialize in early childhood education. In addition, Yangtze River Media’s Love Cube also has special early childhood education services. Therefore, only the two companies are classified into the preschool education investment category. In addition, among the 17 companies, there are relatively few young teachers' training and preschool education programs and enterprises. Among them, there are Wei Chuang shares and Xiuqiang shares, which are dedicated to building a closed industrial chain platform for the preschool education industry. Keyword 2: Synergistic effect Synergy Effects refers to the increased competitiveness after the merger, resulting in a net cash flow exceeding the sum of the expected cash flows of the two companies, or the combined company's performance is higher than the expected performance of the two companies when they exist independently. So, what kind of mergers and acquisitions have synergies? First, the acquirer can identify the unique value of the strategy, process, and resources in the target company, and can maintain and manage the value so that it does not depreciate or not at least; secondly, ensure the resources and capabilities of the acquirer. In the process of integration, it will not be damaged, and it will be able to maintain the new competitive advantage after integration. Finally, the resources and capabilities of the acquirer and the resources and capabilities of the target company can be effectively integrated to create new ones beyond the original two. A new competitive advantage for companies. According to the author's research, according to the last criterion of synergy, we can roughly judge that there are two types of 17 A-share companies that have obvious synergistic effects when they invest in early childhood education. One is that traditional publishing institutions . For example, Phoenix Media, Dadi Media, Times Publishing, its main business is the publishing industry, and there will be a high synergy when transforming children's books; One type is enterprises that are deeply entrenched in the IT field. For example, Tuowei Information, its main business is the software information industry, and there will be a high synergy when transforming into education informationization. In addition, there is a children's wear brand under the Senma clothing itself. There may be some synergy when investing in early education brands, but it is not obvious. Sunshine City, which is doing real estate, considers that high-quality educational resources can add value to the real estate. Therefore, it creates pre-school education. Investing institutions and incubating early childhood education companies will also have a more significant synergy effect on their main business. However, the original main business is the glass processing of Xiuqiang shares and the original main business is the LED lighting diligent shares, the synergy effect will be poor when transforming investment kindergarten or early childhood information platform. However, the more companies with a large transition span, the larger their investment in the field of early childhood education seems to be. Keyword three: transformation efforts In general, the greater the amount of money invested by a transformational enterprise in a new field, the more determined the determination to transform. From the perspective of absolute investment, among the 17 companies, Tuowei Information's investment is undoubtedly the largest, reaching 1.87 billion yuan. Secondly, Wei Chuang shares reached 1.5 billion yuan, followed by Huangshi Group and Xiuqiang shares, which were 1 billion yuan and 939 million yuan respectively. From the perspective of the field of intervention, in addition to Phoenix Media and Huangshi Group, Wei Chuang shares and Tuowei information are to create a complete preschool education chain. Taking Weichuang shares as an example, regarding the company's development strategy in the early childhood education industry, the company pointed out in its 2016 annual report that in 2016, based on the existing leading edge, the company mainly carried out the following work: First, carry out internal work such as strategic unification, education team formation, organization and construction, merger and acquisition integration and consolidation, and lay a solid organizational foundation for further development in the future; Second, the scale of the existing kindergarten operation management service business has continued to expand, and the number of parks affiliated with Hung Hom Education and the Golden Cradle has been greatly increased, and the number of offline kindergartens has continued to increase; Third, continuously improve the quality of kindergarten education and the service to the franchise park, and continuously deepen the construction of the four systems of standard system, training system, service system and supervision system, refine the scientific and standardized management of kindergartens, and consolidate the quality of the park. , to deepen the service and increase the income of the single park; Fourth, the industrial chain strategy will be upgraded, and the industrial layout of the children's quality education and training market will be carried out. The successful non-public issuance will mark the formal implementation of the above-mentioned plan. In general, the integration of various elements, open up a variety of educational services, child-centered users, the formation of all children's growth platform for children. In the previous analysis of the transformation background of the eight companies, the author started from the scale of operating income, and pointed out that in addition to the Changfang Group and Hejing Technology, the other six companies face growth growth or persistence from 2012 to 2014. A downturn. Specifically, Weichuang shares and electro-optical technology are in a continuous decline. The revenue growth of Gaole and Xiuqiang shares is weak, while Shengtong shares have barely increased in 2012 and 2013. The operating income of Qinshang shares appeared in 2013. It has grown considerably, but it has fallen again in 2014. Keyword 4: Operating income growth After the transition to the education industry, from the latest financial data disclosed by the company, the trend is to develop in a good direction. According to the author's statistics, among the eight companies, the companies with significant growth in operating income in 2014-2016 include Changfang Group, Hejing Technology, Xiuqiang, Shengtong and Weichuang. The revenue of electro-optical technology showed a slight decline in 2015, but in 2016 it increased to above the 2014 operating income level. The prevalence of Wei Chuang shares, which had been in a downturn, is obvious. Keyword 5: Rising net profit As the operating income improved, the company's net profit also showed a clear upward trend. As can be seen from Chart 5, in 2014-2016, the net profit of Hejing Technology, Xiuqiang, Qinshang, Shengtong and Weichuang all showed a clear upward trend. Gaole shares and electro-optical technology are still in decline. Among the channels, and after the growth of the Changfang Group in 2015, there was even a loss in 2016. Considering that the transition time of the eight companies mostly occurs in 2015 and 2016, the integration of the education business with the company's original business will undoubtedly require more time, and some of them are still in the continuous investment stage. Therefore, the author believes that From the income statement indicators alone, it is impossible to fully judge whether the transformation of these enterprises is successful. Taking Changfang Group as an example, the company pointed out in the 2016 performance report that during the reporting period, the industry was fiercely competitive and the company's gross profit margin was compressed. Although the company transformed its education industry, the wholly-owned subsidiary Changfang International Education was still in the initial stage of investment. In addition, according to the author's investigation, among the companies that have disclosed the performance report, the education business contributes significantly to the company's business income, and only Wei Chuang, Dianguang, Xiuqiang and Hejing. Similarly, in the case of Wei Chuang shares, in the 2016 annual report disclosed on April 15, Wei Chuang shares pointed out that the company's 2016 operating income was 1.051 billion yuan, of which the preschool education industry contributed 395 million yuan, accounting for 37.58. %, a significant increase from 20.13% in 2015. Keyword 6: Market value growth Under normal circumstances, if the transformation of the enterprise is recognized by the market, then the company's stock price will definitely change more obviously, the market value will also increase, and its growth rate will be better than the broader market. Overall, from 2013 to now, the market value of eight companies has shown a clear upward trend. Among them, the market value has increased more than 2 times, including Qinshang, Gaole, Hejing Technology, Xiuqiang and Changfang Group. The smallest market capitalization is Weixin, only 0.87 times, but it is far better than the same period. The index rose. Keyword 7: Increasing share of institutional shareholders In the securities market, if a company's transformation is recognized by the market, not only will retail investors use funds to pursue the company's stock, but institutional investors, including public offerings, private placements, and insurance institutions, will also take stock of the company's stock. This trend can also be seen by observing changes in the shareholding ratio of institutional shareholders. Figure 10 shows the changes in the shareholding ratio of institutional shareholders of the eight transformation companies from 2013 to 2016. Considering that after the second half of 2014, there was a large increase in the entire capital market in China. Therefore, compared with 2013, the total shareholding ratio of the shareholders of the eight companies at the end of 2014 and the end of 2015 showed a significant upward trend. Not surprising at all. Although the Chinese stock market has undergone a major adjustment since the second half of 2015, market sentiment has begun to slump, and corresponding institutional shareholders are also accelerating the pace of departure, but compared with 2013, at the end of 2016, Gaole shares, Shengtong shares, show The shareholding ratio of Qiangqiang, Hejing Technology and Changfang Group still showed a clear upward trend. Source: Education Investment DELIN HAIR COSMETICS , https://www.hairstylingwaxfactory.com
Insight into the seven key words of the transformation of pre-school education for 17 A-share listed companies