New Delhi Education company Aptech Ltd plans to enter Poland, Rwanda and Senegal as it seeks to earn at least half its revenue from abroad.
Aptech has signed an agreement with a Polish firm to use its network to venture into Poland.
In three months, Aptech will also enter the two French-speaking African countries, chief executive and managing director Ninad Karpe said.
“We have set a target of earning 50% of the retail revenue from outside India (by 2014). We are now on the path,” Karpe said. “In 2008, the share of revenue from the outside market was just 17% and now (2011-12) it’s 37%.”
About 35% of Aptech’s overseas revenue last year came from Nigeria and 40% from Vietnam. The balance came from Malaysia, Russia, West Asia and other countries.
In 2011-12, Aptech had a total revenue of Rs 210 crore.
“In Africa, we are successful in Nigeria. We have got computer education and Arena (its animation and multimedia education subsidiary) there. We are now actively looking at the French-speaking parts, the two countries we are looking at are Rwanda and Senegal,” said Karpe.
“These things take time. You don’t get business and profit immediately. It takes two-three years as education is a word-of-mouth business,” he said. Karpe added that the company is now positioning itself as a “career global education company” and not just as an IT (information technology) education company.
Bharat Gulia, a senior manager with consulting firm Ernst and Young, said the IT education businesses of companies such as Aptech are stagnating in India because of more mainstream education in the space like BSc IT, BCA (Bachelors in Computer Applications), and engineering degrees in IT, forcing these firms to diversify into animation, hospitality and vocational education.
“With less growth in India and opportunity outside, such companies are entering emerging markets,” said Gulia, adding that Aptech has done well in Nigeria and Vietnam. “So entering Poland or some African countries will provide it opportunity,” he said.
Asked about Aptech chairmanRakesh Jhunjhunwala’s decision to offload some stake in the company and if non-clarity on the firm’s Chinese business was affecting the stake sale, Karpe said, “We cannot speak anything on the promoters’ stake.” Jhunjhunwala holds at least 35% stake in the company.
The company’s board had only two representatives from Jhunjhunwala’s side other than the chairman himself, Karpe added. “Other than that, all people in the management team are professional people.”
But he also said Aptech does not count its Chinese business in its consolidated revenue. “We don’t consider it as revenue because we just hold 20-odd per cent investment stake there. That revenue is not consolidated.” The Chinese firm Beijing Aptech Beida Jade Bird Information Technology Co. Ltd has its own plans and may list on some foreign stock exchange, he added.
Though Karpe said his company has strong fundamentals like zero debt, a cash surplus of Rs 100 crore and less than 10% exposure to government business, Aptech’s market capital has eroded significantly, losing about one-fourth of its value in the past year.
Aptech ended Wednesday at Rs 72.70 a share, down 2.28%, on BSE, significantly lower than the 52-week high of Rs 147.90 that it reached on 29 July. The benchmark Sensex ended the day 0.77% lower at 16,312.15 points.