Gross Domestic Product (GDP)

GDP is divided among personal intake, investment, online exports, and federal government spending. Intake accocunts for two-thirds of the full total approximately. GDP is normally mentioned in annual terms, though data are released and put together quarterly. The U.S. Bureau of Economic Analysis releases an progress estimation of quarterly GDP, followed by a “preliminary” estimation and a “last” shape.

It is reported as a “real” number, that is, financial growth without the impact of inflation. The figure is tabulated on the quarterly basis, in the month after 25 % has finished developing. It really is then twice revised at least, with those revisions being reported in each of the weeks following the original release once.

Changes in the GDP of the United States are computed quarterly and announced in annualized terms (the actual annual change would be if the quarter’s pace of development or contraction continuing for a calendar year). GDP reviews appear in most daily papers and on-line at services like America Online. GDP is a way of measuring the condition of the economy often. For example, many economists talk about recession when there’s been a decline in GDP for just two consecutive quarters. The GDP in dollars and real terms is a useful economic signal.

The Company in addition has signed MOUs to develop globally. Reputable partners for Global Expansion – MindChamps have agreed upon exclusive business collaboration with China First Capital Group and Hillhouse Capital. The parties plan to operate preschools and kindergartens under the MindChamps brand in China, Hong Kong, Australia and United States. Blue Chip cornerstone investors – The cornerstone investors are of excellent quality.

Infection point – This Company is within an inflection point where it requires capital to develop and a listing will help achieve both credibility and offer the funds that it can perform its business programs. Loss of IP / Rise of Competition – The Intellectual Property developed by the Company can be “stolen” from unscrupulous franchisees and re-marketed by them. This might be one of the major risk and the mitigant will probably be careful scrutiny by the business and operating in jurisdictions with known legal recourse (not sure about China).

Also disclosed in the prospectus, the business is currently in legal lawsuit in Australia for breach of term sheet. Partnerships neglect to work – Other than lack of IP, the largest risk is execution risk where partnerships with CFCG and Hillhouse neglect to workout and the expansion plans are derailed, especially in the China or elsewhere.

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The mitigant is that if the collaboration fail to work, then the “cornerstone” investments created by CFCG and Hillhouse are affected as well. There is at least some alignment here. 1.7 billion by 2022. While MindChamps target the bigger end segment, the availability of better quality preschools at more affordable pricing may lead to pricing and competition pressure.

The preschool portion happens to be not controlled or mandated by government. High valuation – The IPO valuation is as superior as its school fees. It generally does not come “cheap”. Investors are paying reduced for the business. Could it be still a value buy? Non big 4 auditor – The auditor is Nexia TS Public Accounting Corporation. I want to spend a bit more time on the cornerstone traders today as it forms the key part of my investment decision and chilli ratings. USD 2.3b. They have a few business lines and since 2016, extended to education and schooling services business both within China and overseas.