CL Educate revenues were up about 30% in Q1 FY’24, with strong growth in both EdTech and MarTech business. The management has been saying it is focused on delivering strong growth henceforth, the Q1 results show it is walking the talk. Drilling down, EdTech and MarTech registered 33% and 23% growth respectively in Q1FY’24.
The Edtech business is growing via multiple enough levers. One key plank of growth is network expansion. The company’s first target is to cross 500 franchisees count in in 2-3 years, 3x of the current number. The network expansion will help recharge growth old business lines of MBA and Law Test Prep, where it is the market leader. These businesses were in Rs 60-70 crore per annum bracket in FY19, before Covid struck. The size shrank in Covid years of FY20, FY21 and FY22. They have now come back to the original run rate. The company is keen to hit Rs 100 crore mark in each of these segments.
The EdTech business has two new focus areas now: CUET, the new exam introduced in 2022, and Study Abroad. While CUET is an emerging category, and only time will tell how large it becomes, CL is keen to create a business of a size similar to MBA and Law. Study Abroad is already a large market. If CL gets its act right, this can certainly become the fourth pillar for EdTech.
The company has aggressive targets for MarTech as well. The goal is to double revenues from the FY23 level of Rs 120 crore in three years along with improving EBITDA margins. MarTech wants to focus on two growth engines: globalising its business and increase share of its digital platform VOSMOS. Both of these segments will impact margins positively as their share of total MarTech revenue increases.