The Hong Kong shares of Chinese schools group Wisdom Education International Holdings Co Ltd (HK:6068) plummeted 14.96% to HK$3.58 on Friday morning, a day after Beijing announced new regulations on pre-school education.
Education stocks fell after Beijing condemned kindergartens for their “excessive profit-seeking behavior” and banned private kindergartens from seeking public listings on their own or as part of a portfolio.
Another education company, China Maple Leaf Educational Systems Ltd (HK:1317) also saw its shares plunge by 16.89% to HK$3.69, while the shares of China Yuhua Education Corp Ltd (HK:6169) dropped 12.47% to HK$3.37.
The new regulations put a brake on the country’s booming private education market, which is expected to grow from CNY2.9 trillion in 2016 to CNY4.9 trillion by 2020, according to Frost & Sullivan forecasts quoted by the South China Morning Post.
