Business Profile of the Jaro Institute of Technology Limited
Established in 2009 by Sanjay Namdeo Salunkhe, Jaro Institute of Technology is India's leading online higher education and upskilling platform company. The company caters to 34 Partner Institutions with 22 pan-India offices-cum-learning centers and 15 immersive tech studio set-ups in various IIMs. The company experienced significant user surges in the higher education and upskilling sector due to the shift to online learning and closure of schools and educational institutions post-COVID-19. They capitalized on this by offering live classes, collaborative tools, and comprehensive learning resources. They have a curated offering of customized programs at various academic levels and a holistic course portfolio across fields of study. Their affiliations with top-tier Partner Institutions have led to exponential rise in enrolments for degree programs and certification courses.
The company has established strong and lasting collaborations with these institutions, delivering quality degree programs, certification courses, and admission-related services. The company offers 239 programs and courses, including online MBA, online PG/UG, data science, digital marketing & analytics, finance & banking, cybersecurity & cloud computing, along with various other esteemed programs.
Jaro Institute of Technology Limited IPO Objective
As per the draft red hearing prospects, the IPO issue consists only of offer for sale.
- The OFS consists of up to XXXX Equity Shares aggregating up to Rs. 4, 000 million. Nothing from those proceeds of OFS will be allotted to company.
- Jaro Institute of Technology IPO offer only has fresh issue of Rs. 1, 700 million. As per DRHP document, the company aims to utilize IPO proceedings towards marketing & advertisements, payment of some outstanding borrowings and general corporate purposes.
| Particulars | Estimated amount to be funded from Net Proceeds |
| Marketing, brand building and advertising activities | 810 |
| Payment of a portion of certain outstanding borrowings availed by company | 480 |
| General corporate purposes | XXXX |
| Total | XXXX |
(Rs. Million)
IPO Details of Jaro Institute of Technology Limited:
| IPO Open Date | N.A. |
| IPO Close Date | N.A. |
| Basis of Allotment | N.A. |
| Listing Date | N.A. |
| Face Value | Rs.10 per share |
| Price | N.A. |
| Lot Size | N.A. |
| Total Issue Size | Up to XXXX equity shares |
| Aggregating up to Rs.5, 700 million | |
| Fresh Issue | Up to XXXX equity shares |
| aggregating up to Rs.1, 700 Million | |
| Offer For Sale | Up to XXXX equity shares |
| Aggregating up to Rs.4, 000 million | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not more than 50% of the Net Issue |
| Retail Shares Offered | Not less than 35% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
Issue Price & Size: Jaro Institute of Technology Limited IPO
The issue price of Jaro Institute of Technology Limited hasn’t been released yet. Upon releasing the dates, the investors can bid between those price ranges. The company has both fresh issue of Rs. 440 crores as well as offer for sale of Rs. 1060 crores.
Launch Date of Jaro Institute of Technology Limited IPO
The IPO opening date of Jaro Institute of Technology hasn’t been officially announced yet, upon the declaration of dates investor can bid for IPO.
Jaro Institute of Technology Limited Financial Statements
| Particulars | FY24 | FY23 | FY22 |
| Income | |||
| Revenue from operations | 1990.45 | 1221.45 | 846.08 |
| Other Income | 35.22 | 24.4 | 22.72 |
| Total Income | 2025.67 | 1245.85 | 868.8 |
| Expenses | |||
| Employee benefits expenses | 620.38 | 448.01 | 291.02 |
| Finance costs | 48.1 | 45.77 | 39.91 |
| Depreciation and amortisation expenses | 67.59 | 53.38 | 26.37 |
| Other expenses | 746.08 | 542.32 | 397.62 |
| Total Expenses | 1482.15 | 1089.48 | 754.92 |
| Profit before Exceptional items and tax | 543.52 | 156.37 | 113.88 |
| Profit before tax for the year | 519.91 | 156.37 | 369.7 |
| Profit for the year | 379.72 | 116.65 | 332.3 |
| Particulars | FY24 | FY23 | FY22 |
| Financial KPIs | |||
| Gross Revenue (INR mn) | 4877.34 | 3165.73 | 2501.29 |
| Gross Revenue (y-o-y growth) | 54.07% | 26.56% | 93.11% |
| Net Revenue (INR mn) | 1990.45 | 1221.45 | 846.08 |
| Net Revenue (y-o-y growth) | 62.96% | 44.37% | 59.37% |
| EBIT | 568.01 | 202.14 | 409.61 |
| EBITDA | 635.59 | 255.53 | 435.98 |
| EBITDA Margin | 31.93% | 20.92% | 51.53% |
| PAT Margin | 18.75% | 9.35% | 38.25% |
| Current Ratio | 2.59 | 1.62 | 1.76 |
| Net Capital Turnover Ratio | 2.77 | 3.19 | 4.5 |
| Debt - Equity Ratio | 0.21 | 0.45 | 0.36 |
| Trade Receivable Turnover ratio | 20.34 | 18.33 | 9.4 |
| Net Worth | 1174.32 | 778.45 | 626.03 |
| Return on Net Worth | 32.35% | 14.87% | 52.84% |
| RoCE | 40.90% | 19.12% | 47.22% |
| Total Asset Turnover Ratio | 1.05 | 0.8 | 0.75 |
| RoE | 37.82% | 15.05% | 64.07% |
| Operational KPIs | |||
| Number of Universities | 34 | 29 | 21 |
| CAGR of Universities | 17.24% | 38.10% | 75% |
| Number of Admission | 29145 | 21579 | 19756 |
| CAGR of Admission | 35.06% | 9.23% | 81.08% |
| Number of Offices and Studios | 37 | 29 | 29 |
| CAGR of Offices and studios | 27.59% | 0.00% | 20.83% |
| Customer Acquisition Cost | 20203 | 18372 | 12647 |
Jaro Institute of Technology Limited Promoters & Shareholding
As of date, there are two promoters of the company.
The promoter along with promoter group in aggregate collectively holds 80.46% of the paid-up share capital of company.
| Name of Shareholder | Pre-Offer | |
| No. of Equity Shares | % of total pre-Offer paid up Equity capital | |
| Promoter | ||
| Sanjay Namdeo Salunkhe* | 1,58,34,060 | 78.2 |
| Balkrishna Namdeo Salunkhe | 4,57,098 | 2.26 |
| Total | 1,62,91,158 | 80.46 |
| - | - | |
| Promoter Group | ||
| Rajendra Namdeo Salunkhe | 4,55,098 | 2.25 |
| Anita Sanjay Salunkhe | 4,55,098 | 2.25 |
| Total | 9,10,196 | 4.5 |
| Grand Total | 1,72,01,354 | 84.96 |
Should You Subscribe to Jaro Institute of Technology Limited IPO or Not
While investing or subscribing to any IPO, consider the investment rationales related to the company. Hence, here you can find out the strength of the company that will be its growth factors. And also check the risk factors that can affect the growth and operational efficiency of the company.
Competitive Strengths of Jaro Institute of Technology Limited:
Market leading position in online higher education
Since its launch in 2009, the company has been a leading online higher education and upskilling company in India. As of the end of fiscal 23, the company is among India's leading online higher education and upskilling companies. Companies focus on flexible and accessible learning solutions, partnerships with global learning institutions like IIM Ahmedabad and IIT Madras and customized learning delivery models has allowed them to capitalize on the potential of India's online higher education and upskilling market. The company has also expanded its outreach to collaborate with five prestigious institutions abroad, including Swiss School of Management and Rotman School of Management, University of Toronto.
| Enrolments | As of and for the Fiscal ended March 31, 2024 | As of and for the Fiscal ended March 31, 2023 | As of and for the Fiscal ended March 31, 2022 |
| Degree programs (total) | 24325 | 18435 | 17834 |
| Bachelor’s degree programs | 1300 | 1111 | 549 |
| Master’s degree programs | 22998 | 17249 | 17261 |
| Doctoral degree programs | 27 | 75 | 24 |
| Certification courses | 4820 | 3144 | 1922 |
Solutions to Partner Institutions and Learners
The company offers online, hybrid, and in-person degree programs and certification courses, democratizing education through the National Education Policy, 2020. They aim to enhance the quality of their partner institutions' programs by providing marketing and brand building services.
The company offers business intelligence and program positioning services, acting as a marketing, program management, and technology partner. They assist Partner Institutions with admissions, marketing, sales, and distribution, leveraging their expertise in digital marketing channels.
The company adopts varying approaches to learning delivery, including self-paced, asynchronous, and synchronous learning. They have established immersive studios at various IIMs and set up off-campus immersive tech-supported learning centers across India. They also provide dedicated learner support, interacting regularly with learners to ensure program modifications based on feedback and ensuring practical and industry-relevant skills are integrated into the curriculum.
High revenue predictability
India has significant geographical advantage in comparison to any other country in world. With such a higher learning population, companies online higher education partnerships with upskilling companies and institutions are revolutionizing education by providing enhanced learning experiences, personalized pathways, and increased accessibility. These collaborations with esteemed universities and institutions foster global reach, cost-efficiency, and continuous innovation. Their services support the complete lifecycle of higher education programs, enhancing scalability and reach. Their deep market insight, integration, content production, marketing, and support services have enabled them to grow its client base from 21 partnerships to 34 partnerships.
| Institution | Year of commencement of relationship | No. of programs and courses offered in collaboration |
| IIMs | ||
| IIM Ahmadabad | 2018 | 7 |
| IIM Mumbai | 2023 | 5 |
| IIM Indore | 2022 | 4 |
| IIM Tiruchirappalli | 2019 | 8 |
| 2021 | 7 | |
| IIT | ||
| IIT Madras | 2022 | 2 |
| IIT Guwhati | 2023 | 2 |
Proven track record
The company has a track record of program coverage ranging from 2 to 10 courses in each of its Partner Institutions among the top 10 IITs and IIMs. They focus on both degree and certification domains, offering a diverse range of courses and programs in partnership with 34 Partner Institutions, including 14 Tier-1 universities and 13 Tier-2 universities. The company's innovative digital platforms provide tailored educational content and educators with training and support for effective integration of technology. The company deploys business intelligence capabilities and information databases to collect and analyze data on industry trends, demand drivers, success factors, and financial metrics. They have also established collaborations with 5 renowned global institutions to offer opportunities for online higher education, executive education, and up skilling.
| Course completion rates (in %)* | FY24 | FY23 | FY22 |
| Degree programs | 80.54% | 86.94% | 83.10% |
| Certification courses | 93.25% | 94.40% | 97.78% |
Use of technology
With the emergence of Covid, when everyone in the world was put on stand still. Tech played its role in reaching the unreached. The habits of delivering to home has widely been adopted by institutions and learners. Therefore, India's education market is undergoing significant transformation due to digitalization, skill-based learning, and international collaborations bringing in more content near to home. The shift towards a flexible, inclusive, and skill-oriented education system is reflected in the use of adaptive assessments and data-driven decision-making. The integration of generative artificial intelligence (Generative AI) in education platforms allows for a holistic learning experience, enabling learners to measure program outcomes and track their progress.
Future plans
- Expand its academic portfolio by fostering collaborations and capitalize on the globalization trend.
- Strengthen its foothold presence in existing institutions and expand its client base by identifying additional top-tier universities and institutions.
- Expand its geographical footprint and enhance digital capabilities and platforms
- Invest in technology initiatives to enhance user engagement and drive increased traffic to its platform.
- Expand the roster of freemium offerings and develop user-friendly freemium courses
Risk Factors of Jaro Institute of Technology Limited:
Reliance on reputation and service quality
The company relies heavily on its reputation and quality of service, as it plays a big role in attracting learners in learning industry. Along with its goodwill, the company uses various others techniques like marketing, sales efforts, referrals, and databases to predict industry trends and up skill participants.
The company uses strategic branding partnerships and multiple marketing channels to reduce dependence on high marketing spends and maintain competitiveness. The company may incur sustained marketing, brand building, and advertising expenses in future to attract and retain learners.
| Particulars | FY24 | FY23 | FY22 |
| Marketing, brand building and advertising | |||
| Performance marketing expenses (in Rs. million) | 464.5 | 324.81 | 177.74 |
| Other marketing expenses (in Rs. million) | 80.06 | 34.62 | 56.32 |
| Total marketing, brand building and adv expenses (Learner acquisition costs) | 544.56 | 359.43 | 234.06 |
| Number of enrolments (D) | 19926 | 13157 | 13502 |
| Learner acquisition cost per enrolment (in Rs.) | 27329 | 27319 | 17335 |
| Percentage of enrolment share (in %) | 68.37% | 60.97% | 68.34% |
| % of the total marketing, brand building and adv expenses as compared to revenue from operations (in %) | 27.36% | 29.43% | 27.66% |
| Referrals | |||
| Referral fees (Learner acquisition costs) (in Rs. million) | 44.27 | 37.01 | 15.79 |
| Number of enrolments | 9219 | 8422 | 6254 |
| Learner acquisition cost per enrolment (in Rs.) | 4802 | 4394 | 2525 |
| Percentage of enrolment share (in %) | 31.63% | 39.03% | 31.66% |
| % of the total referral fees as compared to revenue from operations (in %) | 2.22% | 3.03% | 1.87% |
| Total | |||
| Total Learner acquisition costs (in Rs. million) | 588.83 | 396.44 | 249.85 |
| Total number of enrolments | 29145 | 21579 | 19756 |
| Learner acquisition costs per enrolment (in Rs.) | 20203 | 18372 | 12647 |
The company's brand image, partnerships with prestigious Partner Institutions, and focus on learner satisfaction have led to increased learner count through high referral rates, low acquisition costs, and course completion rates. This is due to a counseling-based approach, which drives increased referrals and lower acquisition costs. However, the company faces risks if Partner Institutions believe their programs have developed enough value to draw enrolments, reducing their revenue share and impacting its business. Diversifying the portfolio of services offered to Partner Institutions may also lead to increased marketing efforts and higher acquisition costs. The company is also responsible for protecting intellectual property rights of the content delivered by Partner Institutions, which could lead to contractual breaches and adverse impacts on its reputation, business, and prospects.
Revenue concentration
As can be seen from data mentioned in table below, the company generated most of its revenue from top 3 customers during FY23 and FY22. The share of top 3 clients’ have decreased in FY24 but remained significant. The revenue contribution is not becuaseo f slowing in sales but broadening of revenue discretion from top 3 clients to clients down the ladder. The revenue fom top 10 clients hjas increased drastically from 117 crores to 175 crores within one year.
Any down fall of relationship with its top clients or companies inability to further diversify its clients base could cause them from operation front as well as financial front too.
| Particulars | FY24 | FY23 | FY22 | |||
| Amount | % of total revenue from operations | Amount | % of total revenue from operations | Amount | % of total revenue from operations | |
| Top 3 customers | 1093.1 | 54.92% | 875.93 | 71.71% | 628.43 | 74.28% |
| Top 5 customers | 1375.91 | 69.13% | 1000.88 | 81.94% | 728.19 | 84.07% |
| Top 10 customers | 1754.76 | 88.16% | 1176.326 | 96.30% | 813.03 | 96.09 |
Innovate and implement technological advances
The business relies heavily on maintaining relationships with existing Partner Institutions and growing through new ones. Expanding partnerships for degree programs and certification courses can incur substantial costs due to changes in industry trends. The company offers 239 courses in collaboration with Partner Institutions, with over 100 programs developed based on business intelligence inputs.
The company's success depends on its ability to innovate and implement technological advances, which requires upfront capital expenditure. If the company cannot keep pace with evolving technology and user preferences, it may be unsuccessful in acquiring sufficient enrolments for the courses and programs.
Cyclical business
Education business is cyclical, where admission in some courses is opened during a specific time frame. So online higher education and up skilling sector may cause fluctuations in results of operations and financial condition. Revenue generation may dip during non-enrollment periods or between exam cycles, while expenses spike during the start of new batches. Any significant natural calamity in western region during peak season , such as unforeseen floods, political instabilities, or economic slowdowns may adversely affect the business fundamentals and results of operations.
Development and use of AI
The company incorporates AI technology in its services and business operations, focusing on identifying emerging trends in executive education and developing tools like smart calculators and AI bot-calling. AI presents risks, challenges, and unintended consequences as it is initial stages. Tha problem that could come up are flaws in algo, and incorporating complex technologies. Compliance with evolving laws and regulations may impose operational costs and limit the company's ability to develop, deploy, or employ AI technologies.
Negative cash flow from operating activity
The company has turned into negative cash flow from operating activities in FY24 in comparison from positive cash flow during FY22 and FY23. The company has drawn fund from its investing activity in FY24. Failure to affective generate cash flow might lead to rise in working capital and equity reserves.
| Particulars | FY24 | FY23 | FY22 |
| Net cash provided by/(used in) operating activities | -169.66 | 28.76 | 106.83 |
| Net cash generated from/(used in) investing activities | 471.48 | -76.74 | -61.12 |
| Net cash generated from/(used in) financing activities | -186.06 | -54.54 | 11.73 |
| Cash and cash equivalents at the end of the year | 57.03 | -172.79 | -70.27 |
Jaro Institute of Technology Limited Grey Market premium
Grey market premium is the premium quoted over the IPO issue price. GMP shows that investors are ready to pay above the upper band of the IPO issue price. GMP is determined in the grey market as per the demand and supply of the shares in the primary market. A grey market is that unofficial ecosystem of unlisted companies' stocks that start trading even before the launch of the IPO to the date of its listing.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated & Reliable
However, GMP is not a reliable factor, as it keeps fluctuating as per the demand and supply of shares in the primary market. There are numerous factors that affect the stock market in India and individual stock prices of different companies that are already listed and trading in the secondary market. However, for an IPO-bounded company, you can consider the GMP as the speculative listing price of the share
According to various online sources, the Grey Market Premium or GMP of the Jaro Institute of Technology Limited is trading around Rs XX in the grey market. It means shares are trading at the upper band issue price of Rs XX with a premium in the grey market and may list around the same price.
