It is reported that the history of New Oriental can be traced back to 1993. In 2006, the company successfully landed in NYSE by issuing ads with the stock code of “edu”.
according to public information, the company is the largest private education service institution in China. At present, its main source of income comes from the “education projects and services” business (providing courses and services through schools, learning centers and bookstores), including K12 and studying abroad business, which accounts for more than 80% of its total income.
wind data shows that as of the end of 2019, Yu Minhong, the founder of the company, held 13.43% of the shares, being the largest shareholder of the company; in addition, Davis selected advisors, the second largest shareholder, held 6.49% of the shares. The reporter learned from public information that Davis selected advisors is an investment management company headquartered in Arizona, USA.
in terms of shareholding ratio, Yu Minhong holds a market value of nearly US $3 billion. According to the Hurun global rich list in 2020, Yu Minhong is worth 25 billion yuan, ranking 762.
in March 2019, New Oriental spin off subsidiary New Oriental online went to Hong Kong for listing. It is reported that the New Oriental online year is an online education service provider. So, what is the rationality of the New Oriental, which has just split up its subsidiary, to be listed in Hong Kong for the second time?
Li Daxiao, chief economist of Yingda securities, told the IPO daily, “in recent years, there are many returns of China General stocks, such as Alibaba, Netease, Jingdong, etc., so new Oriental may go to Hong Kong for secondary listing, and this is a quite good choice at present. The reason is that there is a certain uncertainty in the external environment. Although there may be more procedures to be handled, there are multiple channels to achieve the goal of advancing, attacking and retreating. ”
regarding the Hong Kong stock market, Dong Yizhi, an investment finance lawyer, told the IPO daily that there are some reasons why more Chinese capital stocks have chosen Hong Kong stocks recently. For example, the Hong Kong stock market is not only closely connected with the international market, but also connected with the A-share market.
recently, New Oriental released its annual report for fiscal year 2020 (from June 1, 2019 to May 31, 2020). The company’s total fiscal revenue was $3.579 billion, an increase of 15.6% year-on-year; and the net profit attributable to shareholders of the company was $413 million, an increase of 73.6% over the previous fiscal year.
by the end of May 2020, the total number of schools and learning centers established by the company was 1465, an increase of 211 compared with the same period before, including 104 schools; 26.3% new students were added in the whole fiscal year.
it is disclosed that New Oriental’s net income in the fourth quarter of 2020 is $798 million, down 5.3% year-on-year; at the same time, the company’s net profit is 13.2 million US dollars, with a sharp drop of 69.5% year-on-year. Among them, the company’s revenue and cost increased by 5.3 percentage points to 391 million US dollars, mainly due to the increase of teachers’ wages and housing rental costs; the marketing and marketing expenses increased by 11.4% year-on-year, mainly due to the increase in the amount of aid.
in this regard, Yu Minhong, founder of New Oriental, said, “the new crown epidemic has brought continuous pressure on the company’s business, facing challenges in consumer development, and there are also many delays in summer courses. Among them, the overseas business, one of the core businesses of the company, declined by about 52% in the fourth quarter due to the postponement of overseas examinations and studying abroad
the financial report also pointed out that in view of the uncertainties brought about by the new epidemic situation, the company conservatively predicted that the net income of the first fiscal quarter of 2021 (from June 1, 2020 to August 31, 2020) would be between $911 million and $954 million, a decrease of 11-15 percentage points over the same period of the previous year.
in addition, wind shows that since its listing, New Oriental has only refinanced in February 2007, when it issued 7 million shares and raised $291 million.
according to Tianyan information, there are 77 investment events related to New Oriental, including 10 in 2019. They are micro language, Xingji school, Marcopolo learning, duole bear, ahanshool, science team leader, Shengtong, Shizhi TV, Tianli education and micro language. Eight of these 10 items are education and training, and the other two are manufacturing and entertainment media. In addition, in terms of regions, 7 of the 10 items are in Beijing, 1 in Shanghai, 1 in Jiangsu and 1 in the United States.
in July 2012, muddy water issued a 90 page short report, questioning New Oriental. Since then, the shares of New Oriental have plummeted for two consecutive days, falling by 34.32% and 35% respectively. The share price has reached a new low in five years, and the market value of New Oriental has evaporated by nearly 2 billion US dollars.
at that time, muddy water mainly questioned three aspects of New Oriental, namely, franchise rights, counterfeiting in Beijing, and unstable company structure. For example, New Oriental’s revenue increased by 392% after its listing, of which 338% was contributed by stores. Xie Dongying, CFO of New Oriental, said that all stores of New Oriental were self operated and did not join in. Muddy water thought it was a substantial fraud.
in addition, since the beginning of this year, more and more companies may seek to be listed in Hong Kong with the increase of the listing threshold of China concept shares by US stocks. The HKEx will benefit directly from this return tide.