ZME - China confirms official ban on for-profit school tutoring companies

Ababsolutum/E+ via Getty Images China has officially confirmed that the country is banning for-profit school tutoring companies after a report on the possible move sent shares of tutoring firms TAL Education (TAL), New Oriental (EDU) and Gaotu Techu (GOTU) plunging on Friday. Companies that teach school subjects can longer accept overseas investments, according to a Bloomberg report, which cited a notice from China's State Council. Listed firms can no longer raise capital through stock markets and vacation and weekend tutoring is prohibited. Speculation of Friday that China would start the crackdown prompted JPMorgan to downgrade Tal, New Oriental and Gaotu to underweight ratings, which is equivalent to a sell. "While details of the measures remain debatable, the document, if true, will effectively make the sector un-investable in our view," JPMorgan wrote in note on Friday. TAL on its official Weibo site stated over the weekend that it would “fully implement the

For further details see:

China confirms official ban on for-profit school tutoring companies