EdServ plans buy in test prep edu space

Chennai-based provider of technology-driven learning, EdServ Softsystems Limited, is looking at acquisitions in the area of test preparation education, said the company's chairman and chief executive officer, S Giridharan.

“We are looking at business brands for acquisition in the segment. The talks are on and we expect to close one of the deals by the end of this quarter or early next quarter,” he said. The acquisition would add up to the company's top line at the earliest, probably by this financial year itself, and strengthen its presence in the online education service segment, he added.

EdServ has entered into the test prep segment through some content acquisitions almost a year ago. While it was only a supplemental service to its existing education solutions services through its partner firms, the proposed acquisition would support it to create customers of primary loyalty through registration.

The test prep market is huge with opportunities to provide online content for engineering, accounting, medical and civil service students, apart from other segments like post-graduation, Giridharan said.

“We have a strong pipeline for the rest of the year. Our target is to achieve revenues of between Rs 170 crore and 180 crore and a net profit of about 30 per cent of the top line. The company is targeting an EPS (earnings per share) of Rs 25 for the year ended March 31, 2012,” he said.

Through the tie-up with Aircel on Wednesday, EdServe expects to open access to its mobile education application -- HumThum -- to offer the entire range of education content of EdServ through smart phones. It is targeting to provide access to around 2 million students to its education content that includes tuition, test preparation, academics and skill development.

EdServ is targeting a customer base of 10 million over the next two to three years from the mobile segment, which the company had forayed into in June this year. The company has tied up with Nokia, Samsung and Blackberry smart phones.