China’s RYB Education rises on New York Stock Exchange debut
The mainland’s early childhood education sector is expected to hit US$30bn this year, as parents are willing to spend to give their children a head start, say analysts
Shares of China’s RYB Education Institution – the first Chinese early childhood education provider to list in the US – rose 40 per cent to US$25.9 on their debut trading on the New York Stock Exchange on Wednesday from its initial offering price of US$18.50.
The company has aimed to raise US$144.3 million in its offer of 7.8 million American depositary shares (ADS). It said the proceeds raised would be used to further expand its footprint in China’s education industry.
“We are going to focus on the domestic preschool market at the moment with no expansion plans overseas yet,” Yanlai Shi, co-founder and CEO of RYB Education, told the Post in a phone interview immediately after she rang the opening bell on the NYSE.
“We have partly sacrificed our profit margin for the sake of quicker expansion during previous years,” she said. “Now that phase has ended and our investors can expect better returns.”
Though it is one of the largest providers to focus on early childhood education in China, RYB only accounted for less than 0.5 per cent of the market by revenue in 2016 due to the low concentration of large-scale providers.
It currently has over 1,000 self-operated and franchised kindergartens, as well as play-and-learn centres in 250 Chinese cities. The number is a small fraction of the more than 150,000 private kindergartens across the mainland, according to China’s Education Bureau.