Education Q2 Results Preview - A Modest Quarter: PL Capital

PL Capital Report

In a non-seasonal quarter, education companies under our coverage universe are expected to report a modest top-line growth of 7.0% YoY with an improvement in gross margin. For S Chand And Co. Ltd., it is the weakest quarter of the season and top-line is expected to remain flat, while Navneet Education Ltd.’s core publishing business would continue to face growth challenges.

After the announcement of the National Curriculum Framework, phased adoption of new books was expected over time, leading to a rise in volumes. While the adoption rate is lower than expectation, we believe it will rise going ahead as NCERT publishes new books for higher grades.

We maintain our positive bias on book publishers, and S Chand remains our preferred pick with a target price of Rs 312 (12 times FY26E earnings per share; no change in target multiple).

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