Noriko Mori, 47, paid about ¥700,000 ($6,300) to a cram school to help her daughter prepare for a school entrance exam in Tokyo. Her daughter was six, and the entrance exam was for an elementary school.

"It was expensive," Mori said. But "she passed the test for the school she wanted, so it was a choice well made."

The cram school in question was Riso Kyoiku Co., which provides private lessons to children of all ages whose parents can afford to pay. Goldman Sachs Group Inc. thinks it's a winning strategy, and has initiated coverage on the stock.