In a column published a few days ago, Morningstar’s Shane Ponraj shares a somewhat bearish perspective on IDP Education Ltd. Echoing some sentiments I’ve shared here many times in the past, he notes:
“While IDP co-owns IELTS, one of the most widely accepted English tests, it’s losing market share. English proficiency testing is now increasingly commoditized. IDP previously held some exclusive licenses for education admissions and visa applications, but this has largely disappeared.”
And:
“The English language testing business is IDP’s second-largest business. As part-owner of the International English Language Testing System, IDP operates one of the world’s most widely accepted English language tests for access to education institutions, professional bodies, and visas. Over the past decade, IELTS has lost English proficiency certification exclusivity for most of the institutions where IELTS is accepted, leading to increased competition for test takers. With the acquisition of the British Council’s Indian operations, another part-owner of IELTS, IDP has less competitive pressure in India, the world’s largest English language testing market and holding almost half of IDP’s testing volumes.”
So it goes.