Educomp Solutions Limited's Business Model
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Case Code: BSTR352 Case Length: 18 Pages Period: 1998-2009 Pub Date: 2009 Teaching Note: Not Available |
Price: Rs.300 Organization: Educomp Solutions Industry: IT, Education Solutions Countries: India Themes: Business Model, Competitive Advantage |
Abstract Case Intro 1 Case Intro 2 Excerpts
"By all conventional yardsticks of corporate evaluation - return on equity, return on capital employed, and cash flow - ESL's numbers are excellent. The company's business model is unique and unprecedented. It lacks peers for comparison purposes."
- Prashanth Nayak, Manager, IL&FS Invest Mart, August 2008.
"Our children are not equipped with the right kind of skill-sets which would make them employable candidates in the future. Therefore, we need to make sure that all children are made part of this digitally aware generation and have the same levels of exposure to IT."
- Soumya Kanti, President, ICT Division, Educomp, May 2009.
Introduction
On September 29, 2008, India based Educomp Solutions Limited (Educomp) was listed in Forbes '200 Best under a Billion' for Asia-Pacific region. For this list, Forbes selected those companies which had pre-tax profits of at least 5% in that year and five years returns on capital of at least 5%. These companies were then judged on sustained gains in sales, return on equity, and earnings. Analysts said that with sales of US$ 71 million for the fiscal year 2007-08, Educomp had been selected because of its promising growth potential and its unique business model.
Founded in 1994 by Shantanu Prakash (Prakash), Educomp operated in the education sector by providing Information Technology (IT) enabled solutions to the students, parents and schools. Educomp served the K-126 segment of academia both in India and other countries like the US, Singapore, China and Sri Lanka. The company also operated schools through its subsidiaries and joint ventures with other institutions. Educomp offered products that helped teachers and parents to make the process of educating children more effective. Besides the K-12 segment, Educomp also expanded into developing educational products that were employment oriented like courses in business management, marketing, accounting, insurance and interior design.
As of June 2009, Educomp provided services to 23,000 schools and 12 million learners and educators across the world. It was the leading K-12 online education company in India. Educomp expanded through both organic and inorganic routes. It acquired equity stakes in various companies in the education sector in several countries as a part of its global expansion strategy. It collaborated with several renowned institutes like Indian Institute of Technology (IIT) to develop content relevant for the target segment of the company...
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