Key Takeaways:
Hiducation has filed to list in Hong Kong, but declining revenues and deepening losses in the first half of this year could undermine its investor appeal
As the top-ranked provider of training in construction industry skills, the company's exposure to China's ongoing property downturn is another negative
Beijing Hiducation Technology Corp. Ltd. hopes to educate investors about the growing importance of vocational training in China with its application for a Hong Kong listing last week. But the company could quite possibly get its own lesson from those same investors, who may decide to take a pass on its story tied closely to China's ailing property market.
Hiducation may be using its application to test investor appetite for a company that's China's largest online vocational educational firm for the construction industry, and second largest in emergency services.
With a gross profit margin of 85.8% in the first six months of 2025, Hiducation certainly looks quite attractive in terms of that metric. The company is hoping to follow in the footsteps of leading vocational educator China East Education (0667.HK), which raised $625 million in 2019, making it the world's largest education float at that time.
But investors haven't been kind to China East Education's shares, which have lost about half their value since then. That said, China East Education's gross margin was just 59% in the first half of this year, well below Hiducation, though its top and bottom lines are both much healthier, with its revenue and profit up 10% and 48%, respectively, for the period. By contrast, Hiducation lost money in the same period, and its revenue also declined.
Hiducation has grown rapidly since it launched its first brand, Haixue Classroom, in 2010 for vocational learning, and its premium credentials training brand, Jingjin Academy in 2018. But it has also been mired in losses since at least 2022, the earliest year covered in its listing document. And as we've already noted, its core products are tilted towards jobs in a Chinese property market that has been in the ...
