Morgan Stanley reported that the 2021 annual results were broadly in line with expectations, while the external growth of different companies brought different levels of contribution. M&A activities including China Cooper (01890.HK) and New Higher Education Group (02001.HK) began to be conservative. The bank lowered China Kepei's target price from $6 to $4.9 to maintain the “new high education” rating from $6 to $4, and from “overweight” to “equating with the market”.
The report pointed out that degree vocational education has opportunities for growth in the medium to long term, but the period of rapid growth has passed, and the industry has entered a fierce competitive stage. The Bank believes that Yuhua Education (06169.HK) reduced its target price from $6.8 to $4.6 in the short term due to increased capital expenditure and sustained the “overholdings” rating.
Big Mo believes that Hope Education (01765.HK) is expected to have a strong admissions capacity and it is expected to take time to improve its school quality. The target price is slightly increased from $1.4 to $1.6, and rated “same with the market”.