Company Reports

China East Education's first-half 2026 revenue grew 11% year on year, while net profit rose 13%. Student registrations increased 7%, and the on-campus student population was up 3%.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education's student registrations rose about 7% year-on-year in the first half of 2026, with tuition revenue from freshmen increasing by more than 15%. New enrollments in three-year programs were largely flat, while 15-month program enrollments surged more than 50%.

China East Education's second-half 2025 revenue grew by 14% year on year, while net profit surged 46%.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education guided that student intake grew by a mid- to high-single-digit percentage year over year in the second half of 2025, while revenue rose about 10% during the same period.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East's first-half revenue grew by 10% year on year, while net profit surged 48%.

China East Education's preliminary net profit surged by 45%-50% year on year for the first half of 2025 as revenue grew by about 10% while costs remained stable. New student registration increased by about 7% year on year.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East’s 2024 results exceeded our expectations, with net income rising by 88% year on year to CNY 513 million, helped by gross margin expansion amid cost reduction initiatives. While maintaining our revenue forecasts, we have increased our net income estimates by 13%-29% for 2025-28, after factoring in reduced cost assumptions. This has resulted in an 11% increase in our fair value estimate to HKD 4.73. China East's share price has more than doubled from its January low and is now 2% above our revised valuation. We recommend that investors wait for a better entry point.

We think YuHua’s proposal to settle its convertible bond with a mix of cash and new shares is a positive move to remove the default risk that has persisted for two years. The disposal of its Thailand school is also value-accretive, in our view. As a result, we raise our fair value estimate to HKD 0.89 per share from HKD 0.80. Despite YuHua being deeply undervalued, we believe the risk of share disposal by bondholders after settlement and the overhang from its for-profit school classification will remain key concerns for investors. Our preferred pick is China East Education, trading at a 37% discount to our fair value estimate, with earnings likely having bottomed in 2024.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education’s first half 2024 results are in line, but the proportion of new enrollments in three-year programs was lower than expected. We attribute the mix change primarily to competition from public schools. We leave our 2024 estimates largely unchanged but reduce our revenue assumptions by 6%-13% and net income estimates by 17%-27% for 2025-28 after assuming lower enrollments in three-year programs. As a result, we cut our fair value estimate by 16% to HKD 4.28 per share.

We think China East Education‘s student enrollment will likely fall short of our original forecasts as its employment-oriented programs appear to be losing appeal among students who are increasingly willing to further their studies amid a sluggish job market. Therefore, we reduce our average student enrollment forecasts by 3%-12% for 2024-28, leading to a 4%-11% reduction in our revenue forecasts. We keep our net profit estimate largely unchanged at CNY 421 million for 2024 after factoring in cost-control efforts, but we lower our earnings estimates by 7%-10% for 2025-28. Consequently, we cut our fair value estimate by 5% to HKD 5.07 per share. We think the shares are attractive, trading at only 44% of our fair value estimate. China East is committed to keeping the dividend stable at least for 2024-25 and the current share price translates into nearly 9% annual dividend yield.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education is the largest vocational training education provider in China. It started from and is best known for its culinary arts education. Over the last three decades, it has benefited from the rapid expansion in China’s labor market, which created strong demand for vocational training education. We think that remains a driver for China East over the next five years given continued industrial upgrading and shortage of skilled labor.

China East Education's 2023 earnings missed our expectations due to margin contraction, although revenue was in line, which we attribute to increasing challenges in student recruitment amid rising competition. Based on the disappointing results, we adjust our student enrollment and margin forecasts and cut our net income estimates by 17%-21% for 2024 through 2027, reducing our fair value estimate by 12% to HKD 5.36. Despite the cut, we think it is time to buy narrow-moat China East, as we believe its earnings have bottomed out and expect margin to recover in the coming years. We now project CNY 422 million net income in 2024, up 55% year on year. In addition, the proposed dividend translates to an 8.3% dividend yield based on the March 28 share price, and management intends to keep the dividend amount stable. We think the dividend provide downside protection while the anticipated earnings rebound offers upside potential.

We think China East Education’s 2023 results are likely to fall short of our expectation amid a challenging economy that is hurting demand for its short-term programs as the outlook for jobs remains weak. As such, we lower our average student enrolment growth assumption to 3% from 5% year on year. We also reduce our average tuition fee growth forecast to 2% from 4%. This results in a 10% cut in our net income estimate to CNY 349 million for 2023, down 5% year on year.