Tutoring services firm Career Point Ltd has received Rs 4.2 crore ($625,000) from National Skill Development Corporation (NSDC) to provide skill training to youth in diverse trades, it said in a statement.
The Rajasthan-based company will use the money to train 4.5 lakh youth in 36 diverse trades in multiple sectors over a 10-year period, it said.
This loan is the first tranche of Rs 12.6 crore committed by NSDC for executing the project that covers training under key industrial as well as service sectors. The total expenditure on the project is said to be Rs 16.8 crore.
The courses run under this programme would be about three-four months of duration covering classroom training, practical and on-the-job training.
The company, formerly known as Career Point Infosystems Ltd, offers tutorial services to high school and post high school students for various competitive entrance examinations such as AIEEE, AITJEE, AIPMT and pre-dental test. The company, which was launched in 2000, also claims to be catering to technical campuses and private universities in multiple geographies.
The educational services provider posted net sales worth Rs 69 crore in FY2015-16 compared with Rs 62 crore a year before. The firm registered a 40 per cent rise in net profit.
NSDC is a public private partnership (PPP), with 51% equity held by private sector and the balance 49% by the government. Formed in 2010, NSDC is a not-for-profit company that includes 31 sector skill councils and over 160 training partners with more than 2,500 training centres spread across 444 districts in the country. NSDC is mandated to skill 150 million Indians by 2022.
“Disproportionate demand and limited supply force students to approach these coaching centres,” said Narayanan Ramaswamy, partner and head of educational skill development sector advisory at KPMG in India.
“Investors are also attracted toward the test prep segment because of minimal regulation,” Ramaswamy said. “Investors don’t want to bet on a sector where there is restriction for entities setting up their business,” he said.
Several test prep companies has secured funding from investors in the recent past. Metis Eduventures Pvt. Ltd, which operates test preparation centres under the Career Power brand, has raised its first external round of funding from a Pune-based venture capital firm.
Delhi-based startup Avanti Learning Centres has raised around $5 million from Michael & Susan Dell Foundation while online test prep startup Toppr.com has raised $2 million in venture debt, a few months after securing $10 million in its Series B round.
Another well-known test prep company is CL Educate Ltd, which operates under the Career Launcher brand. The Gaja Capital-backed company last month received regulatory approval to float its initial public offering.
In the broader education sector, ed-tech startup Byju’s recently raised $75 million from Sequoia India and Belgian investment firm Sofina.
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