In China, Baixing.com reports huge profit for FY2016
05 Jul 2017
Baixing.com, one of China’s leading classifieds sites, released its FY2016 annual report this week, and it revealed a net profit for the Shenzhen-based company in FY2016 of 11.2 billion RMB ($1.7 billion U.S.). This was the first time Baixing released an earnings report, and the first time it made a profit over the period of a full financial year.
(That number also makes Baixing the classifieds business with the biggest net profit in the world, if we’re not mistaken. Bigger than Japan’s Recruit Holdings. Also bigger than anything in the U.S.. And remember, 58.com (China’s biggest on revenue) still made a net loss in FY2016 (here) – editor.)
Baixing covers recruitment, property, used autos, and used goods, as well as on-demand services.
Gross income was 340 billion RMB ($50 billion U.S.), up from 146 billion RMB in 2015, a year-over-year increase of 132 percent. Of this, 123 billion RMB was derived from listings, up from 76 billion RMB in 2015. Marketing services were the driver of the company’s growth, however, increasing from 69 billion RMB in 2015 to 202 billion RMB in 2016.
The company received 13.5 billion RMB in state subsidies.
Founded in 2005, Baixing is often the forgotten figure in Chinese classifieds, overshadowed by the massive (in terms of revenue – editor) 58.com-Ganji (NYSE: WUBA) conglomerate, formed after China’s two biggest classifieds sites merged in 2015.
Baixing’s revenue jump was driven by the company’s continued efforts to expand into China’s tertiary and lower-down cities – i.e. the hundred-plus cities with more than one million people each. Baixing has quietly been growing a respectable footprint, and currently operates in 367 Chinese cities, almost on par with the 380 cities covered by rival 58.com.
The company listed on the National Equities Exchange and Quotations market (NEEQ), China’s over-the-counter (OTC) equity market, in March 2016. To date, it is the company in the NEEQ which has reached a market capitalization of 40 billion RMB in the shortest period.
Baixing has been very active on the NEEQ, both in soliciting investment and as an investor. In January, the company issued RMB 14 million ($2 million U.S.) in new shares via the NEEQ (which we reported on here).