IDP Education's (ASX:IEL) International English Language Testing System (IELTS) volumes will be affected by the IELTS' decision not to bid for the UK Home Office English Language Testing (HOELT) contract, but the company faces a "smaller" impact than the British Council with its lower exposure to UK Visa and Immigration, Jefferies said in a Wednesday note.

The bidding is part of the UK government's assessment of options for future procurement of the HOELT to be delivered in the UK and internationally.

The impact on the company's IELTS volumes is projected to be less than 5% from fiscal 2027, starting from August onwards, with the revenue impact anticipated to be similar to or slightly lower than the volume impact, Jefferies said.

Jefferies reaffirmed its buy rating and AU$7.80 price target on IDP Education.

IDP Education shares fell past 1% in midday trade Wednesday.