No of Colleges in India: India Education Statistics

No of Colleges in India: Source AICTE, UGC, Planning Commission
India has over 33 thousand colleges. Of these close to 20 thousand colleges are run by private institutions. The balance includes 669 colleges run by central government and remaining are
administered by State Governments. The adjoining graph shows the growth of number of colleges since 1971 (Click on the graph to see the magnified image ).
Tuesday, February 25, 2014
Posted by Kapil

No of Universities in India

The following table provides the data on number of universities in India. This is part of our series of posts on Education Statistics in India.

Number of Universities In India

The data source is UGC, AICTE, NCTE, INC and Planning Commission. Of these 152 are Central Universities, 316 are State Universities, and balance 191 are Private Universities.

Wednesday, February 19, 2014
Posted by Kapil

Education Sector Expenditure - Budget 2014-15

In the interim budget announced today, government proposed to raise expenditure on Education sector by 9% (vs Revised Estimates for 2013-14) . Total Budgeted Expenditure on Education is Rs 81,441 Cr . This includes plan and non-plan expenditure. The breakup and comparison of expenditure is given below.

What is noteworthy is that for next year, the BE is only 9% higher than RE for current year, and is lagging overall proposed expenditure growth (at 11%) for the government. BE for 2013-14 was 18% higher than Actuals for 2012-13.

Rs Cr 2012-2013 2013-2014 2013-2014 2014-2015
Plan - Expenditure Actuals BE RE BE
Department of School Education 42822 49659 47159 51198
Department of Higher Education  12711 16210 14703 16200
Total  55533 65869 61862 67398
Non-Plan Expenditure        
Department of School Education 2810 3042 2977 3287
Department of Higher Education  7720 10552 9787 10756
Total 10530 13594 12764 14043
Total Expenditure         
Department of School Education 45632 52701 50136 54485
Department of Higher Education  20431 26762 24490 26956
Total 66063 79463 74626 81441


India GDP Growth Rate Picks Up, Despite Lower Estimate?

As predicted here, India's lowered its growth estimate for FY14 from 5% to 4.9% but it still turned out to be a positive news as India had lowered the growth rate estimate for FY13 to 4.5%. India had achieved 4.6% growth in H1 FY14 and as per current projection H2 growth would be around 5.2%, signalling positive growth momentum for India.
Predictably, the finance minister expressed satisfaction over the growth outlook and direction for the economy. Like corporate earnings, managing macro perceptions has also become a game, and is driven by managing expectations and delivering slightly better than what the market generally expects you to do. Not everyone buys into it of course,but it has its supporters.
To be true the growth rate expectation has been lowered than previously estimated, and would generally be seen as negative for the economy and for the stock market. However, since government had lowered the growth rate estimate for FY13 to 4.5% vs original estimate of 5% (by estimating size of economy in FY12 to be larger than previously thought), the implication is that economy is beginning to pick up momentum and signals that growth rate is beginning to turn around. Importantly, it means that there is a now a chance that  it can pick up even more in the future.  All you can say is "Well played Chidu!"
Unbelievable? Believe it...
Notes to Self: See Self Serving Bias
Saturday, February 8, 2014
Posted by Kapil

Gray Matters Gets Funding From MSDF

Gray Matters India Private Limited ( has received funding from Michael and Susas Dell Foundation ( Gray Matters, founded in 2006, is a Gray Matters Capital incubated firm and focuses on assesments and educational analytics for K-12 schools.

The capital raised by MSDF will be used for developing products, building analytics framework, and will also be used to cater to the operational losses till the company hits break even, said Pradeep Sharma, chief executive officer of GMI.

The company which includes a couple of students from ISB in its top management, operated as a non-profit organisation earlier and decided to change its model to a for-profit company only a year ago. It aims to reach break-even by 2015-16.

The company aspires to reach more than 5,000 schools, 2 million students and 100,000 teachers in the next five years. At present it caters to about 650 schools. GMI plans to to increase the role of assessments and analytics in K12 education and help improve educational quality by making data actionable to schools.

Gray Matters India
“Assessments and school ratings are a big unmet need of schools that target low-income communities and this is a great opportunity for GMI to create industry suitable assessments and a market of quality conscious schools in this segment,” said Prachi Windlass, Lead, Education, at MSDF.

The foundation recently invested in LabourNet Services India Pvt Ltd along with social VC fund Acumen.
Thursday, February 6, 2014
Posted by Kapil

OMG Facebook! You beauty!

Facebook delighted its billion+ followers on its 10th anniversary, with a video link that provided a LookBack on their individual journeys on facebook. The individual curated, roughly 1 minute videos are personalized with the images that each person posted on their profiles through the years including the most liked photographs. Saw several people in my family gushing and happy at seeing their videos yesterday.

Congratulations Facebook. You've just made a personal connection with your billion plus users.

To see your own lookback video visit

PS: You need to have posted a threshold number of videos to get a video. Else you may only get a set of photographs.

Wednesday, February 5, 2014
Posted by Kapil

Enrollment in Higher Education in India: India Education Statistics

Here's a snapshot of Enrollment in Higher Education in India and target for 12th Five Year Plan 

  • The target is to increase enrollment to about 36 million by 2016-17 (vs 26 million in 2011-12).
  • This implies a CAGR of only 6.7% (vs 9.4% achieved in the 11th Plan. 
  • ~60% of the additional enrollment is planned from Private HE institutes. 
Despite the lower growth target, this may turn out to be a stretch due to a number of factors including slowdown of the economy and regulatory uncertainty. The dichotomy is that Indian laws prohibit profit making from education, yet expect private enterprises to keep investing in education. The problem with current set-up is two fold 

  • Not all the money that would otherwise be invested in the sector would come in 
  • Of the money that does come in, a large proportion of money invested would be by people who believe that they can "manage" the system. The outsourcing model that this system compels, leaves not money to be reinvested back in the education system to improve quality of education besides being used to increase the number of seats. 
Even if India were to achieve this, GER would still be ~25% meaning the other 75% have no access to Higher Education. We are not even planning to provide them an opportunity for this. Indian urgently needs to open up Higher Education.

12th Five Year Plan: Expenditure on Education in India

Trend of Plan Outlay on Education
Plan Outlay (expenditure) for Education in the 12th - 5 year plan by Government of India 

  • Overall outlay increased to Rs 4,537 billion 
  • The outlay is up 66% over original outlay of Rs 2,733 billion made in the 11th Plan 
  • As per estimates by Planning Commission, public expenditure (centre + states) on Education during the Eleventh Plan was Rs 12,447 billion. 
  • Of this 43% was on Elementary Education, 25% on secondary education and balance 32% on Higher Education
  • Per Capital Expenditure increased to Rs 2958 in 2011-12 (vs Rs 888 in 2004-05)

Why India's GDP growth downgrade for FY13 could be a reason to cheer?

India recently revised its GDP growth percentage for FY13 to 4.5% . This happened because the size of the GDP measured for FY12 was raised higher and on this higher base the previous estimate for FY13 thus meant lower growth.

India revises its estimates for GDP three times before settling for a final number and FY13 number could still therefore turn out to be higher. Anyhow, the first reaction to this has been that short term India's economy seems to be in a bigger hold. 5% growth estimate was anyways lowest in a decade. 4.5% growth sounds like a dooms day scenario.

Curiously, what this also means is that whatever is the GDP estimate for FY14, the growth number would be compared against FY13 and on a relative bases the growth number would look rosier than before. Eg. a 4.9% growth number would signal a moderate turnaround in fortunes (vs 4.5%) whereas earlier (vs 5%) it would have looked like a continuing downtrend in growth rates.

I am therefore left wondering if any of this is an exercise in deception (self or otherwise) but is likely to have a positive impact on markets, as GDP growth numbers are announced in the coming quarters. Macro watchers should then cheer and increase their weight-age for investments in India 
Sunday, February 2, 2014
Posted by Kapil

Market Dividend Yield (NIFTY)

The market dividend yield is near long term average at 1.5%. Dividend yield had touched a high of 3.2% in 2003 and a low of 0.6 in 2001. The following graph shows dividend yield of NIFTY since 1999

The following tables provides the range of dividend yields for NIFTY since 1999

Dividend Yield
Thursday, January 30, 2014
Posted by Kapil

NIFTY P/E Ratio Trend

The following chart displays P/E trend for NIFTY

Market Valuation: NIFTY P/E Ratio

The current P/E ratio for NIFTY is 17.7, which is a tad below long term average of 18.3.

RBI Raises REPO rates

In a surprise move, RBI raised REPO Rate by 25 basis points to 8% today,  in its toughening stance against inflation. This despite the fact inflation, although still very high, had fallen more than expected last month to 9.87%. 

REPO Rate is the rate that at which RBI lends money to Scheduled Banks and is  key interest rate for enacting monetary policy. Increasing REPO rate leads to increase in borrowing costs for banks and hence leads to increasing cost of borrowing by consumers. 

In case banks decide to pass this on to consumers, the interest rates for education loans, car loans, home loans etc would also go up. 

Tuesday, January 28, 2014
Posted by Kapil

Education Sector Outperforms IT Sector

Here's a comparison of returns given by listed education companies since October, 2013

Returns Since October 2014

  • Shares of Education companies have outperformed the broader markets, including the IT sector since October 13
  • The sector had faced strong headwinds over the last two years as the sector's performance and valuations had taken a hits, disappointing many investors
  • Interestingly Tree House and MT Educare, which have been reporting good results, witnessed a moderate decline in share prices as their share prices had massively outperformed the sector. 
  • Even after this correction the companies are available at a fraction of their peak valuations over the last few years 
  • While the companies have been taking strong steps to deal with the challenges, the questions is whether this is merely a correction or a sign of turnaround

Market Cap of Listed Education Companies

Sunday, January 26, 2014
Posted by Kapil

Indian Education Sector:Performance Over Last 3 Years

  • FY13 was a tough year for listed education companies in India. 
  • Only Tree House and MT Educare witnessed healthy growth
  • However, growth rates were down for all education companies, including for Tree House and MTEducare 

*For NIIT, the growth rates exclude impact of Element K Sale

NIIT Limited: Valuation Analysis

Company Name: NIIT Limited
Last Update: January 22, 2014

NIIT is a leading education and training company based in India. Its present in three primary segments
a) Individual Learning Solutions: Vocational Training in IT, Banking and other services areas
b) Corporate Learning Solutions: Managed Training Services (MTS) and custom content development
c) School Learning Solutions: Provides technology based products and tools to schools

Valuation (at CMP of Rs 28 per share)

Investment Thesis:
  • The company appears to be grossly undervalued at current market price of Rs 28 per share
  • NIIT owns 23.98% of NIIT Technologies (a mid-tier IT company). The value of these shares is Rs 5880 million, which is more than the current market cap of NIIT Limited. 
  • With Net Debt of Rs 632 million (as of December 31), and assuming 25% discount to its holding value of NIIT Technologies, the implied enterprise value of the business is just Rs 841 million
  • With a Revenue of Rs 9600 million last year, this is very attractive and is at historically low multiples
  • NIIT's margins and profits were depressed in the last 18 months due to slowdown in IT training 
  • Still the company had an EBITDA of Rs 530 million which is likely to improve this year. 9MFY14 company has already done roughly 500 million of EBITDA
  • What is significant is that its other business segments are beginning to make up for the impact of decline in IT and it appears that the company is turning around (see Q3 results of NIIT)
  • The star is the Corporate Training business - which is a niche area of outsourcing and is now over 40% of the business on run-rate basis. NIIT is the only listed company in the area of Managed Training Services and could get a premium as this gains scale. MTS is already 3/4th of NIIT's corporate learning solutions business
  • Capital intensity in the business is reducing as reflected by declining depreciation and AR days

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