Understanding the Market | NEW HIGHER EDU rose nearly 7% in the afternoon, with a year-on-year increase of 8.6% in interim net profit and recent new agreements for higher education cooperation in Hainan

NEW HIGHER EDU rose nearly 7% in the afternoon, and as of the time of publication, it was up 5.75%, trading at HKD 0.92, with a transaction volume of HKD 12.774 million. In terms of news, NEW HIGHER EDU previously announced its interim results, with main revenue increasing by 7.8% year-on-year to RMB 1.413 billion, total revenue increasing by 11.4% year-on-year to RMB 1.6513 billion, adjusted net profit increasing by 7.0% year-on-year to RMB 456 million, and net profit increasing by 8.6% year-on-year to RMB 469 million. In addition, the company signed a school operation cooperation agreement in mid-April, planning to establish a higher education institution in Hainan Free Trade Port. Huatai Securities pointed out that the company's capital expenditure in the first half of the year was RMB 393 million, and the spending pace is in line with the annual guidance (RMB 800-900 million). The company's existing schools' degree enhancement application work is progressing steadily, and it announced plans to cooperate in establishing an undergraduate and above higher education institution in Hainan, further expanding its school network. We believe that the company's fundamentals remain robust during the transformation period of degree enhancement, with strong stability in higher education revenue and profits, and we are optimistic about long-term sustainable organic growth