China Maple Leaf Education Limited (1317.HK) Satisfactory growth on student enrollment, but still with policy risks April 29, 2019 672

PSR Recommendation: REDUCE Status: Downgraded
Target Price: HKDHKD3.78

Investment Summary
China Maple Leaf Education Systems Limited is a leading international school operator,
from preschool to grade 12 education (K-12) in China. Although the valuation lifted
recently thanks to the rumor of a looser regulation on “Education Promotion Law”, we
believe that even if there are any difference in regulations compared with “Draft for
deliberation “, the main content will not change much. Therefore, the business risk on
compulsory education and kindergarten are still very high. As a result, we downgrade
the rating from “Neutral” to “Reduce”, with a TP of HK$ 3.78, 10.8% potential downside.
(Closing price at 25 April 2019)

About the author

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Terry Li
Investment Analyst

Graduated from Lingnan University, with Master of Science in International Banking and Finance and Bachelor of Business Administration respectively. Specializes in analyzing company fundamentals and valuation to explore investment opportunities in TMT, Education and Financial industry.

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