CCBI Upgraded Target Price of China New Higher Education from HKD4.2 to HKD5.9 With “Outperform” Rating Maintained

(10 October 2017, Hong Kong) China New Higher Education Group Limited (“China New Higher Education”, together with its subsidiaries, “the Group”, stock code: 2001.HK) was upgraded target price by CCBI from HKD4.2 to HKD5.9 with “Outperform” rating maintained. CCBI suggested that the student enrolment and average tuition fee of China New Higher Education for school year 2017/2018 meet expectations; campus expansion and five-year program offered at Yunnan and Guizhou will provide growth momentum for the Group's future performance.

CCBI mentioned that, China New Higher Education reported 17% year on year growth in student enrolment to 54,290 for 2017/18 academic year. Recently, the Group introduced five-year college education program at Yunnan school attracted 1,793 new students. Stripping out those students, enrolment at the school in Yunnan rose from 19,490 to 21,849, up 12% year on year and 7% above the estimate of CCBI. Students enrolled in the five-year program will commence their studies at partner schools during the first and second academic years, later transferring to and paying their tuition to the Yunnan school starting from September 2019. CCBI expected that the expansion of both campuses – Yunnan and Guizhou – and the five-year college education programs will efficiently boost enrollment for years to come.

CCBI indicated that Group-wide average tuition saw a 7.7% year on year increase to RMB11,562 whereas the average for Yunnan and Guizhou’s rose 7.8% year on year to RMB10,705. CCBI thought that these trends are broadly in line with the firm and market expectations, and were optimistic about the Group's financial forecast. Therefore, for China New Higher Education, “Outperform” rating was maintained by CCBI with a target price of HKD5.90.