Recently, we have come out with a Research Report on the 'Test Preparation Industry'. Back ground of the Research: Private Equity has become a happening space in the past 4-5 years in the Indian Capital Markets. In the Private Equity circles, Education has always been on top of the radar. Within the education space, 'Test Preparation Industry' has received the most attention due to its superlative growth during the past decade - helped by India's demographic dividend. Career Point has already hit the stock markets with a successful IPO attracting 50 times over-subscription, with a total demand of US$ 1.20 Bn. Further, the pre-school chain "Tree House" has already completed its IPO of INR 114 Crores in which Matrix PE is an investor. MT Educare, which operates under the brand "Mahesh Tutorials", has already filed IPO prospectus with SEBI. 58 PE deals have happened in this industry during the period of last 5-7 years, aggregating to a total investment of approximately US$ 1 Bn. The companies such as FIITJEE (funding in excess of INR 190 Crores), Resonance (funding ofINR 60 Crores) and Shri Chaitanya (funding of US$ 25 Mn) have received PE funding. So, many more IPOs can be expected as PE funds will try to find exits. To deliberate all this further, we have put together this report on the 'Test Preparation Industry', from the private equity view point. The outline of the report, as well as the details to place the order is given in the attachment. The report has been covered by Mint newspaper (on August 8, 2011) and Outlook Profit (in their August edition). Regards, FinPac Financial FinPac Financial Information & Resources Regus Elegance 2F, Elegance, Jasola District Centre Old Mathura Road New Delhi 110 025 Mob: +91 99533 25682 E-mail: info@finpacfinancial.com Website: http://www.finpacfinancial.com/

1. Report on Test Preparation Market
Case Study – FIITJEE Limited
India largely comprises of large section of middle-income families
having strong perception that education is the only way to reach
higher strata and thus is an education-oriented country.
IIT and IIM, being dream courses, face stiff competition in entrance
exams. This has lead to emergence of several companies in the
‘Test Preparation Market’ whose size has been pegged to the tune of
$68 Bn.
Amongst such Test Preparation centers, FIITJEE is positioned quite
strongly with top-of-the-mind brand recall. FIITJEE has become
the favorite amongst Private Equity investors with couple of funds
already invested in.
How much profit is FIITJEE making?
Who are the Private Equity Investors in FIITJEE?
Year 2011

2. The Beginning
In the year 1996, a large chemical factory of JK Synthetic in Kota (small town in Jaipur,
Rajasthan) closed down leading to many engineers loosing their jobs. Several of them left the
town, however, many decided to stay on, and to make both ends meet enterprising ones such
as Dr. V.K. Bansal began to offer private tuition to IIT aspirants for a fee.
At that time, the objective behind these private tuitions was just survival. No one has even an
iota of idea, that this incident was a curtain-raiser for a multi-million dollar “Test Preparation
Industry”. As the tutorial institutes of Kota region kept producing top rankers in the entrance
exams such as IIT JEE, not only students from across the country flocked to Kota in search
of their fortune, even the Private Equity funds queued up to latch upon the stakes in these
tutorial institutes.
The competitive landscape in the “Test Preparation Industry” is booming with more and more
institutes emerging in the industry with North India witnessing emergence of FIITJEE, Bansal
Classes, Career Point, Resonance etc. and advent of leading players like Brilliant Tutorials,
Shri Chaitanya, Narayana etc. in South India.
All in all, over past decade, it has been a dream time for the “Test Preparation” industry. The
industry which has started just for survival emerged into multi-million dollar industry. The
past decade has been a highly exciting and intensified time for this unregulated industry.
Deals Landscape
The “Test Preparation Industry” has seen about 58 private equity deals over a period of past
3-4 years. The prominent ones being –
► Career Point Infosystems went one step ahead. After raising INR 50 Crore through a private
equity investment by Franklin Templeton Mutual Fund in July 2009, it went public, raising
INR 115 Crore. The issue got 50x oversubscription. Oh yes, that means INR 115 Crore IPO
had received response for an amount of INR 5,750 Crores. That is, an IPO demand of
upwards of US$ 1.2 Billion.
► FIITJEE received two rounds of funding. In 2009, Matrix Partners invested INR 100 Crores
in the first round of funding in FIITJEE. This was followed by INR 90 Crore funding by Q
Learn in December 2010.

3. ► In 2011, Fidelity Growth Partners India (FGPI) has invested up to US $15 Million in Mind
Shaper Technologies Private Limited to acquire a significant minority stake. The company
branded as Classteacher Learning Systems is in K-12 educational content with over 85,000
modules, 500 schools and 0.5 million students. It offers an integrated solution to assist
teaching in classrooms using software, hardware and school support services.
► Over a period of 2009 to 2011, Pearson picked up 76% stake in the TutorVista for US$
139 Million thereby providing the exit opportunity to the original Private Equity investors
(Sequoia Capital and LightSpeed Ventures) and the strategic investor (Manipal Group).
As several of the PE investments have happened about 3 years back, there is a good chance for
some of these companies to launch their IPOs in the coming 6-18 months period, to provide
multi-bagger exits to their investors.
Despite some hiccups, “Education” is too good an industry for PE funds to miss the opportunity.
As almost the entire organized education industry producing the formal qualifications
are guided by the regulations and run in the ‘Trust’ format, there is very little scope for
making investments at that end. So, to take advantage of education opportunity in healthy-
demographic-blessed India, “Test Preparation” industry is proving to be the only and sure way
for PE funds to invest.
To deliberate all this further, we have put together this report on the “Test Preparation”
industry. To get better insights, we have taken FIITJEE as an industry representative to unveil
the hidden perspective.
To order a copy of the report:
Please mail to: contact@finpacfinancial.com
Contact point: Reena (0091) 9953325682
In India: INR 499/- per copy

4. Takeaways from the Report
The report will make an effort to demystify:
1. Recent Developments in the “Test Preparation” Industry with clear focus on the Private
Equity deals and public listings from the industry.
2. Why so much Private Equity (PE) fascination towards “Test Preparation” Industry?
3. Overview of Test Preparation Industry
 Number of students appearing for IIT-JEE
 Number of students appearing for AIEEE
 Number of students appearing for CAT
4. Background, Business overview, Key achievements and Pricing Points of FIITJEE
Limited.
5. Snapshot of Private Equity investments in FIITJEE with Investment Metrics such as
 Investor
 Date of Investment
 Instrument
 Deal price per share
 Amount Invested
 Investment Break-up
 Implied Pre-Deal Valuation
 Implied Post-Deal Valuation
 Broad Highlights
6. Financial Analysis and Valuation of FIITJEE
 Income Statement of last 6 years
 Balance Sheet of last 6 years
7. Competitive Landscape and Peer Analysis
8. How Market Shares stack up amongst the competitors?
 Market Share based on Revenues
 Market Share based on EBITDA Margin
 Market Share based on PAT and PAT Margin
9. Future growth opportunities for the industry
10. List of PE deals in the Industry