IDP Australia is expected to pay off lucratively as most of the students are using its language tests to travel to Canada and the United Kingdom. Due to the COVID norms in the country, the number of students travelling to Australia for study is declining. Despite this multibillion-dollar loss, Australian universities are set to profit from their own loss as many investors show faith in the global profitability of international education.
IDP is a Melbourne based education consultancy which saw its stock soar 22%, which is an all time high of around A$30 in July after it was awarded the exclusive rights to conduct the IELTS English- language test in India. The stock price continued to remain 16% above its pre-pandemic high, which implies that the reaction of the investors during the beginning of COVID-19 pandemic, when the stock dropped by 56% in a month, was merely a speck in the firm’s continuously rising value.
The optimism of investors in IDP IELTS business and referrals to several other countries including Canada, UK has almost increased by three folds in the past three years since the company was listed on the Australian Stock Exchange during late 2015, and that the stock has now tripled again.
“But besides the serious challenges faced by the Australian education providers due to curbs on the international students, the afloat share price of the firm reflected the likely strength of global demand for overseas education”, said Claire Field, a Sydney- based consultant.
Due to the overwhelming stock of IDP, around 38 Australian universities can anticipate investment surpluses to help offset the loss of international admissions. These universities are the shareholders through Education Australia, a collectively owned holding company.
The IDP ownership is revamping and is on the horizon due to which many universities are ready to invest. Education Australia’s 40% IDP share capital will be disbursed to universities, giving them substantial assets of about A$83 million each, based on current stock values, under schemes which were announced in March. This episode exemplifies the enormous opportunities available in international education. Andrew Barkla, the CEO of IDP, was titled, best paid chief executive of Australia ahead of the pandemic, whose earning was reported at A$37.8 million from the sale of 3.7 million shares granted as a part of IDP’s 2015 stock market float.