Returns On Capital Are Showing Encouraging Signs At Raffles Education (SGX:NR7)

Raffles Education Limited (SGX:NR7), an investment holding company specializing in education and related services, has shown encouraging signs in its return on capital (ROIC) in recent years. The company's ROIC improved from -0.17% in 2022 to 1.06% in 2024, indicating a significant turnaround in its capital efficiency. This improvement can be attributed to several strategic initiatives and positive developments within the company.

One of the key factors contributing to Raffles Education's improved ROIC is its expansion into new service offerings. The company has diversified its portfolio to include education consulting and development, education supporting, business and management consultancy, and vocational and technical training services. These new revenue streams have helped the company tap into new markets and enhance its overall return on capital.

Another important factor is Raffles Education's ongoing bond issuance strategy. The company has been raising funds through the issuance of unlisted, non-convertible bonds to investors, with the most recent issuance being S$750,000 worth of bonds to two investors. This strategy aims to raise up to S$20 million to enhance the company's financial position and improve its return on capital.

Raffles Education's expansion into new markets and regions has also contributed to its improved ROIC. The company operates in the regions of ASEAN, North Asia, South Asia, Australasia, and Europe, offering diploma, undergraduate, and postgraduate programs in various design, business, and technology disciplines. This geographical diversification has allowed the company to tap into new revenue streams and improve its overall return on capital.



In conclusion, Raffles Education's return on capital has shown encouraging signs in recent years, driven by its expansion into new service offerings, ongoing bond issuance strategy, and geographical diversification. The company's improved ROIC indicates that its strategic initiatives and positive developments are paying off, and investors should keep an eye on this promising education provider.