HK Stock Market Move | TIANLI INT HLDG(01773) rose more than 17% during trading, with a stable and profitable high school business. The entrusted business is expected to become the second growth engine.

TIANLI INT HLDG (01773) rose by more than 17% during the trading day, reaching a 17.39% increase as of the time of writing, at HK$4.05, with a trading volume of HK$36.8226 million. Huatai pointed out that TIANLI INT HLDG is the leading private K12 education provider in the western region of China. After the release of the Implementation Regulations of the Private Education Promotion Law, the company established a "one primary, multiple subsidiary" strategy, focusing on profit-making high schools with comprehensive operational services as a support, steadily transitioning to a national comprehensive education service provider. Since FY22, the company's performance has seen rapid improvement. It is believed that the boundaries of private education policies are gradually becoming clearer, and the industry demand and competitive landscape are expected to remain relatively stable over the next 5 years. The company has a good reputation in teaching, highly standardized operational management capabilities, and excellent ability to expand into different locations, with ample growth potential. The bank pointed out that there is a certain difference in market outlook for the development of entrusted business. The estimated potential market space for entrusted business is around billions, with the current total market share of the leading players being less than 10%, indicating that the market is still a blue ocean. With good teaching reputation and mature operational management experience, TIANLI's entrusted business is in a rapid expansion stage. The low asset entrusted business is expected to increase the company's revenue and profits, open up growth space for diversified comprehensive operational services, and improve the student source system, potentially becoming the second growth point after the high school business.