It had in 2011 bought a stake in Indus World School, a unit of CL Educate. The latest transaction brings HDFC to own stake in all the businesses of CL Educate, the holding firm that has presence in several education businesses, including coaching and skill development.

“Despite the fresh purchase, HDFC’s total stake in the company has not touched double digits,” a company executive said, requesting anonymity.

“CL is led by a competent team that has built a very potent platform in education. Their values-driven and hands-on approach makes them a front-runner to build a strong education brand in India,” HDFC’s managing director Renu Karnad said in the statement.

CL Educate, led by founder-chairman Satya Narayanan R., provides coaching for civil services exams, law school entrance exams, and management and engineering entrance tests. It also sells books related to these examinations through its recent acquisition, GK Publications.

“HDFC is one of the most respected institutions and their participation in CL’s growth is a strong endorsement of the CL way of building business. In an opportunity called India, we have an opportunity to build a trusted and hugely successful education brand,” said Satya Narayanan.

The fresh investment in the firm will help CL Educate expand its presence in running high schools, spokesperson Rajiv Saxena said. The firm already has 14 schools in 12 cities. Private equity firm Gaja Capital Partners had invested $8.2 million in Career Launcher in 2007.

HDFC also intends to start HDFC School in Gurgaon on the outskirts of Delhi. Besides, it is looking at the skills and vocational space, which has a good potential, and CL Educate has a considerable presence in that sphere. The housing finance firm had initially entered the education sector after it had bought a 41% stake in education loan provider Credila Financial Services Pvt. Ltd. Credila was then the only dedicated education loan providing firm.

The Indian education market will be worth Rs.5.9 trillion in 2014-15 against Rs.3.33 trillion in 2011-12, India Ratings and Research Pvt. Ltd, a part of Fitch Group, has estimated. India is home to one of the youngest populations, and some 230 million are in schools and nearly 28 million more are in colleges and varsities.

Experts say India’s focus on education, skill development and aspiration of a growing middle class in the country provides a good opportunity to HDFC.

“HDFC has a fairly good interest in the education sector and through CL Educate, it wishes to expand in this lucrative market. Two areas where it seems to be interested are vocational education and skill development space and, second, the formal education sector...,” said Rohini Kapoor, senior manager, education practice at consulting company Deloitte Touche Tohmatsu India.