@mikebrisy I know I'm answering my own observations here but have done a little more digging around for similar data and came across the Australian Info.

https://data.gov.au/data/dataset/student-visas

Looking at the Higher Education, Primary Visa Holders granted spreadsheet, its pretty clear that these results have been pretty messed around by COVID and look to just be stabilising this year. I.e. the appropriate comp is probably 2018/2019 which was before the world went a bit crazy. The drop in the industry is because 2022/23 was a massive catchup year. Just looking at the YTD figures for Australia of 142,787 visas granted (even though its down a long way from last year's catchup its meaningfully ahead of the same period in 2018/19 (where there had been 126,989 visas granted).

The long term growth of visas granted taking COVID fluctuations looks to be around 8 to 10% per annum, so a pretty good growth for IDP's placement services.

Interestingly, the thing that popped out for me in looking at this data was how material Vocational Education was as well ... generally about a third of higher education numbers but still significant.

Also, looking at the Canadian numbers, its pretty clear they let things get a bit out of control (issuing at least 4x the Visas of Australia when its less than 2x our population) ... clearly a big industry for them. Bottom line, the Canadian's seem to be trying to create the net number of foreign students level and the article I found this table in cited 20% of the people with Visas aren't even studying so I wonder if they were part of the Addressable market for IDP anyway. https://monitor.icef.com/2024/01/canada-hosted-more-than-1-million-international-students-in-2023

@RhinoInvestor , yes that's pretty much how I have been looking at things. More generally for industries that were significantly disrupted by the pandemic, I always try to do my analysis extrapolating from the last clean year, so 2018/19 for FY and 2019 for CY.

One consideration on looking at student Visas is that the pandemic disruption drives visa issuances in a way which is not necessarily related to incremental revenue for the industry. For example, let's say I am on a 2 year program and got a 2 year visa in 2019. But then perhaps I suspended my studies for a year and chose to stay at home. Well, my Visa expires and I have to apply for a new Visa, even though I can get a deferral for my college program. Because I had a visa and was underway with my program (which I was able to suspend) it doesn't necessarily drive any new placement revenue.

So, 2022 and 2023 saw a big market push for visas driven by 1) resumption of interrupted studies and 2) pent up demand of cohorts who would have wanted to study during 2020 and 2021, but deferred their studies.

So, looking at total permits (as you have done) is better than looking at visa issuance, which is what I have been tracking.

Even if my characterisation of the above dynamic is incorrect in the details, looking at this as an industry with long-term, structural growth, I do exactly what you've indicated which is to consider the long run trends. Canada reigning in visas in 2023/24 (backend) and 2024/25, still keeps them on a long term growth trend.

I think the government responses in Canada and Australia make perfect sense - the national infrastructure just can't cope with placing everyone who wants a place when they want, so some temporary visa rationing makes perfect sense from a political and economic perspective.

Which all brings me back to the same conclusion, that the short thesis makes sense if your time horizon is 1-2 years. And because of that, it presents an opportunity for the investor with the long term horizon, So, I'm still not done accumulating this one!

As for all the "noise" around fake students - I'm not sure the extent to which it impacts placement revenues for the industry. I guess if you want to get into the country enough, you might be prepared to pay for the service. What is good news is that any tightening up by governments is going to increase the value of services that can achieve higher success rates than the average, and again $IEL is a winner there.

@mikebrisy I think we are aligned in our thinking. The other thing that keeps going through my mind is that quite clearly the demand is still there with people in these source countries wanting a western education. It’s just a matter of where these students end up going while some of the markets have restrictions in place … the logical answer seems to be the US so I’ll watch IDPs performance there closely coming off what seems to be a relatively low base.

Even if they are fake students … willing to pay for a fake placement is still real money for IDP even the applicant just wants to ride an UberEats bike around town the majority of time. I just hope that IDP doesn’t have too much of that as I could see it being a negative impact on their reputation (which clearly seems to be above that of their competition given their relative growth rates).

DISC: Held in SM and IRL (and still topping up as well)