Wisdom News APP learned that on August 26, the CPC Central Committee and the State Council issued opinions on promoting the spirit of educators and strengthening the construction of high-quality and professional teachers in the new era. The opinions pointed out that by 2035, the modernization of the governance system and governance capacity of the teacher workforce, and the digitization enabling of teacher development will become the norm; improving the Chinese characteristics of the teacher education system, enhancing teachers' subject capabilities and subject literacy, enhancing teachers' ability to educate and teach, optimizing teacher management and resource allocation, and increasing the guarantee of teacher benefits at all levels.

In recent times, there has been a frequent warm breeze of policies to promote the high-quality development of the education industry. From July 15th to 18th, the Third Plenary Session of the 20th CPC Central Committee pointed out that education, science, and talent are the fundamental and strategic support for the Chinese-style modernization. The communique and decisions of this meeting have placed education, talent, and science together, and education is expected to become the infrastructure for the development of science and technology, to a certain extent changing the market's positioning of the education sector.

The meeting deliberated and approved the Decision of the CPC Central Committee on further comprehensively deepening reform and promoting the Chinese-style modernization. The Decision emphasizes accelerating the construction of a high-quality education system and coordinating the comprehensive reform and innovation of educational methods, school-running models, management systems, and guarantee mechanisms. Promote the integrated reform and innovation of ideological and political courses in primary, secondary, and tertiary schools, and improve the comprehensive nurturing system for morality, intelligence, physical education, art, and labor. Focusing on the training of top-notch innovative talents, classify the reform of universities, establish a discipline adjustment mechanism and talent training model driven by scientific and technological development and national strategic needs. Insist on strengthening education with first-rate teachers, improve teachers' abilities to educate, and cultivate a long-term mechanism for teachers' ethical and professional conduct. Effectively utilize world-class educational resources and innovative elements to promote high-level educational openness.

On August 19, the State Council executive meeting deliberated and approved the Opinions on promoting high-quality development of service trade through high-level opening up and other documents. The meeting pointed out the need to further relax market access to foreign investment and push forward the opening of service sectors such as education and medical care.

On August 3, the State Council issued the Opinions on promoting high-quality development of service consumption, proposing to promote the opening up of high-quality educational resources for higher education institutions, research institutions, and social organizations to meet the diverse and personalized learning needs of the public. Promote the improvement and efficiency of vocational education and the establishment of high-level vocational schools and specialties.

In addition to the continuous warming of policies, from the recent performance of major education and training industry companies, a strong recovery trend has been evident.

New Oriental's financial report for the fourth quarter of the 2024 fiscal year, ending on May 31, 2024, shows that the company's net revenue reached 1.137 billion USD, a year-on-year increase of 32.1%. TAL Education's financial report for the first quarter of the 2025 fiscal year, ending on May 31, 2024, shows that the company's net income reached 0.414 billion USD, a substantial increase of 50.4% year-on-year. China East Education achieved a revenue of 1.983 billion RMB and a year-on-year growth of 1.6% in the first half of 2024, with an adjusted net profit of 0.278 billion RMB, a year-on-year increase of 57.9%.

CITIC Securities research report pointed out that the overall continuation of the previous policy path, continues to be bullish on professional education and non-disciplinary training. The policy is expected to exert force in two directions. On the one hand, the State Council is expected to increase financial support for information-based vocational education and high-quality vocational education development through new financial support measures, stimulating the development of related demand. On the other hand, it is expected to continue to support privately-run vocational education with the relevant policies, further optimizing the pattern of deep participation of social forces in running schools.

Founder Securities stated that the education sector is receiving positive information and continues to have a positive outlook on the continuous realization of the performance and valuation repair of education sector companies. It is recommended to pay attention to the improvement of the competitive landscape, with strong demand benefiting companies such as Xueda Education, New Oriental, TAL Education, Shanghai Xinnanyang Only Education & Technology, Tianli Int Hldg, Beststudy Edu, and Scholar Edu. With macro employment pressure, there is a continuous strong demand for enrollment and exam preparation, benefiting companies such as Cendes Co., Ltd., Offcn Education Technology in.

Related concept stocks:

China East Edu (00667): Achieved a revenue of 1.983 billion yuan in the first half of 2024, a year-on-year increase of 1.6%, with an adjusted net income of 0.278 billion yuan, a year-on-year increase of 57.9%.

New Oriental-S (09901): Goldman Sachs pointed out that New Oriental provides comprehensive education services and has made effective and profitable investments outside the education field, such as education-related investments, making the company's sources of income more balanced. After completing the business adjustment for the 2023 fiscal year, New Oriental is still in the early stages of its multi-year expansion. The brokerage firm predicts that from the 2023 to 2026 fiscal years, New Oriental's annual compound growth rate of earnings will reach 25%, with an annual compound growth rate of earnings per share of up to 43%. It maintains a "buy" rating and sets a target price of 71 Hong Kong dollars.

China Edu Group (00839): As a leader in providing high-quality higher and vocational education, the group's enrollment of students in Chinese tertiary education institutions continued to grow significantly in the 2023/2024 academic year, increasing by approximately 0.013 million from the previous year, a year-on-year increase of over 16%. Undergraduate enrollment increased by approximately 10%, and junior college enrollment increased by about 56%. The group will be able to provide high-quality education and development opportunities and support the national regional development strategy and industrial transformation and upgrading for more students.

Yuhua Edu (06169): The company and its subsidiaries mainly provide private formal education services from kindergarten to university non-vocational education in Henan Province, China. The company consists of three business departments: kindergartens, primary to secondary education (grades 1-12), and universities.