GLMS SEC released a research report stating that the education industry is expected to experience a "three-dimensional resonance" from marginal policy improvements, industry supply consolidation, and unleashed market demand. The investment logic for the sector has shifted from being policy-driven to earnings-driven. With relatively low industry valuations, the sector is poised for a "double boost" in both earnings and valuations, propelled by supportive policies. Meanwhile, the education sector represents a major application arena for artificial intelligence, making "AI+Education" the central investment theme. Leading education companies are likely to benefit from advancements in "AI+Education." Key viewpoints from GLMS SEC are as follows:
High-Quality Development and "Investing in People" On March 13, the "Outline of the 15th Five-Year Plan for National Economic and Social Development of the People's Republic of China" was officially released. The Outline prioritizes "achieving significant progress in high-quality development" as the foremost goal for the 15th Five-Year Plan period, encompassing areas such as economic development, innovation, public welfare, green development, and security. Among the 20 main economic and social development targets listed for the 15th Five-Year Plan period, indicators related to public welfare account for the highest proportion, highlighting a new approach of "investing in people" within China's economic transformation. Increasing investment in human capital, fostering its accumulation, and generating a "human capital dividend" are strategic measures for China to gain initiative in the new round of technological revolution and industrial transformation and achieve high-quality development.
Integrated Advancement of Education, Science and Technology, and Talent Development; Promoting Educational Equity and Quality Enhancement Educational planning guidance for the 15th Five-Year Plan period signifies a strategic upgrade from "building a high-quality education system" to "integrating the advancement of education, science and technology, and talent development" and "delivering education that satisfies the people." "Integrated advancement of education, science and technology, and talent development" emphasizes the trinity of "education, science and technology, and talent," stressing the establishment of a unified coordination mechanism to better promote the deep integration of technological innovation and industrial innovation. This indicates that education will no longer be viewed solely as a public welfare endeavor but also as a source of technological innovation and a base for talent cultivation. The key to building a strong education system lies in delivering education that satisfies the people. The 15th Five-Year Plan period will continue to promote educational equity and quality enhancement, explicitly positioning the construction of an education powerhouse as a strategic project for high-quality population development.
Digitalization and Artificial Intelligence Empowering the Education Sector The 15th Five-Year Plan period will see deepened advancement of the Digital China initiative, with comprehensive efforts to empower various sectors with digital and intelligent technologies. The role of digital intelligence technologies and data elements in enriching people's lives and improving public welfare will be fully leveraged, expanding integrated applications in areas such as education, healthcare, elderly care, culture and tourism, employment, and consumption. The "AI+" initiative, concerning education, points towards innovating teaching models such as intelligent learning companions and AI teachers, and deepening applications like precision teaching, personalized learning, and intelligent tutoring.
Education Benefits Public Welfare; Coordinated Construction of a Childbearing-Friendly Society For the first time, the 15th Five-Year Plan Outline coordinates education with building a childbearing-friendly society, accelerating the construction of a Healthy China, and actively responding to population aging. It calls for improving the mechanism for allocating educational resources in line with demographic changes. The 15th Five-Year Plan period will treat the silver economy as a new economic growth point. Whether in the elderly goods industry, elderly care financial products, or new business formats like senior tourism, education, and culture, the aim is to enrich the supply of elderly care service consumption.
Risk warnings include changes in industry policies, intensification of industry competition, enrollment figures falling short of expectations, and slow earnings realization.