The Zhitong Finance App learned that education stocks continued their recent gains. As of press release, China Oriental Education (00667) rose 5.17% to HK$2.44; New Oriental-S (09901) rose 2.42% to HK$72; China Kepei (01890) rose 2.29% to HK$1.34; and Yuhua Education (06169) rose 1.11% to HK$0.455.

According to the news, on February 8, 2024, the Ministry of Education issued the “Regulations on the Administration of Out-of-School Training (Draft for Comments)”. Guoxin Securities pointed out that the “Draft for Solicitation of Comments” is the first administrative regulation issued by the country on the management of out-of-school training, combining 2 years of practical experience at the grassroots level. The opinion draft continues the original purpose of the “double reduction” policy to reduce the burden of compulsory education subject training. The statement that the level of supervision is basically the same, and there is no marginal tightening. Furthermore, the classification management rules encourage the non-subject training business, affirm the transformation results of existing leading education and training institutions, and also point the direction for the future development of the industry.

The bank pointed out that from the initial “double reduction” policy to the current “Draft for Solicitation of Comments”, the original purpose of the national legislation was not to completely eliminate out-of-school training, but to guide the high-quality development of the out-of-school training industry, with a view to creating a good educational ecosystem. Considering the clear and positive attitude of the new policy, the education and training industry is expected to continue to benefit from improved fundamentals and the rebound in valuations driven by sentiment.