(China Daily) Shares of iHuman Inc, a leading Chinese online childhood edutainment provider, jumped more than 30 percent on the Wall Street debut Friday, joining the latest in a flurry of IPOs that investors cannot ignore.
The Chinese e-learning company’s stock opened at $12.12 on the New York Stock Exchange. Its share price closed at $16, giving the company a market cap value of more than $800 million.
Trading under the ticker symbol “IH”, the company priced its IPO at $12 per share to raise around $100 million.
The company said it plans to use approximately 35 percent of the net proceeds of the offering for expanding its products and service offerings, both domestically and overseas. Other net proceeds will be used for the development of existing products and services, improving its technology infrastructure, marketing and brand promotion and the balance for general purposes.
Chi Yufeng, founder and chairman of iHuman Inc, said with the emerging new technologies, the company will be able to offer more competitive products, which will offer better learning experiences for children.
“Parents will always chase products with higher educational efficiency. For online education companies, only by continuously creating and providing better products and services can they survive in the market,” Chi said.
Dai Peng, chief executive officer of iHuman, said the company will continue to focus on the integration of its online and offline business.
“We’ve seen rapid growth in the online business, which will continue to occupy a major part of the future growth,” Dai added. “However, the offline business also plays a key role in our research and development system, which helps complement our online business.”
Dai noted with both online and offline services, children will be able to interact online and enjoy offline immersive reading.
The company reported its total revenues nearly doubled from 91.8 million yuan ($13.7 million) in the first half year of 2019 to 185.5 million yuan in the first six months of 2020.
According to the company, its revenue comes mainly from users’ paid subscriptions for premium content of the learning apps, as well as the sale of learning materials and smart learning devices to both individual users and educational organizations.
The company said its users are primarily children aged between 3 and 8, with parents who seek quality childhood educational resources for their children. And those parents are generally the more tech-savvy younger generation born in the 1980s and 1990s.
The number of iHuman’s average total monthly active users grew from 3.2 million in the first half of 2019 to 9.3 million in the first half of 2020. The number of paying users who paid subscriptions for the premium content on iHuman apps surged from 600,000 in the first half of 2019 to 2.1 million in the first half of 2020.
The company said it intends to expand the users of its learning apps to older children groups, particularly those aged between 8 and 12, which will help increase user lifetime value.
In the first half of 2020, the company’s learning app iHuman Chinese gained the top spot among the best-selling educational apps list of the Apple App Store in China.
Buoyed by the large population of children, parents’ higher disposable income and increasing focus on children’s education as well as the fierce competition for admission into top schools, the total revenue of the complementary childhood education market has grown rapidly from 420.6 billion yuan in 2015 to 780.2 billion yuan in 2019, according to the Frost & Sullivan Report.
The report said the total revenue of China’s content-based complementary childhood education market has jumped from 25.4 billion yuan in 2015 to 111.4 billion yuan in 2019 and is expected to increase to 460.9 billion yuan in 2024.
Due to the COVID-19 impact, kindergartens, primary schools and offline learning centers in China were closed in the first half of 2020, leading to a rapid increase in the demand for content-based complementary childhood education, especially online courses and online learning products. It is expected that the penetration rate of China’s content-based complementary childhood education will continue to increase from 14.3 percent in 2019 to 34.5 percent in 2024, the report added.
Source: By Ouyang Shijia | chinadaily.com.cn | Updated: 2020-10-10 13:46