[Click eStock] "Megastudy Education, High Growth in Elementary and Middle School Online Education"

[Asia Economy Reporter Minji Lee] Ebest Investment & Securities on the 31st expressed expectations for solid future growth of Megastudy Education, recommending a buy rating with a target price of 110,000 KRW.

Megastudy Education is an online education platform company targeting elementary, middle, and high school students as well as adults. It owns brands such as Eli High for elementary students, Mbest for middle school students, Megastudy for high school students, and Kim Young for university transfer preparation.

The investment point for Megastudy is its consistent growth trend. Over the past five years, the company has shown high growth of 32.2%, and in the first half of this year, it maintained a growth rate of 23.7% compared to the previous year. Operating profit margin improved from an average of 3.8% in 2016 and 2017 to 12.7% in the first half of 2021, and further to 16.5% in the first half of this year.

It is also positive that sales revenue from elementary and middle school education is increasing. Related sales revenue expanded from 43.9 billion KRW in 2018 to 165.5 billion KRW in 2021. Looking at the first half alone, this year recorded 107.1 billion KRW, about a 30% increase compared to the first half of the previous year. The operating profit margin of the elementary and middle school business division grew from 10.7% in 2019 to 18.6% last year. In the first half of this year, it increased to 20.5%, up from 18.1% last year.

Researcher Hongshik Jung of Ebest Investment & Securities said, “Elementary students are becoming accustomed to non-face-to-face learning culture, and online private education for advanced learning purposes is increasing, making the growth of the Eli High brand stand out,” adding, “The trend of external growth and profitability improvement is expected to continue in the future.”

Researcher Jung also analyzed, “As the number one online education company in Korea, price increases and sales volume expansion in the elementary and middle school sectors are expected,” and “The average EPS growth rate is projected to reach 17.2% by 2024.”

This content was produced with the assistance of AI translation services.