The jack-of-all-trades group is disposing of a loss-making legacy business after leaping onto the AI business bandwagon

Image Credit: Bamboo Works

Key Takeaways:

• The company, with interests from education to traditional Chinese liquor, has announced plans to divest its debt-laden home appliance business although the subsidiary was its main revenue earner
• Qidian Guofeng recently acquired an AI tech firm and struck a distribution deal with Metax, which makes graphics processors for AI computing

For many companies, specialization is the key to growth. But some diversified enterprises behave more like chameleons, morphing to reflect the latest opportunities and hot trends.

Those firms are hard for investors to categorize and may lack a clear edge in any of their various businesses.

China Qidian Guofeng Holdings Ltd. (1280.HK) fits that description perfectly. Its footprint has stretched from education to alcoholic drinks, AI technology, home appliances and even blockchain tokens, as it apparently chases the next big business idea.

For chameleon companies, that also means periodically shedding a skin. This week, Qidian Guofeng revealed it was relinquishing its entire stake in a loss-making household appliance arm in a deal that removes the unit from its equity structure while leaving the business under the control of the group's chairman.

Wholly owned subsidiary China Yinrui (HK) Investment Holding Co. Ltd., which operates the appliance business, is to be acquired by shareholder Noble Trade International Holdings Ltd., indirectly held by Qidian Guofeng Chairman Yuan Li, for a nil consideration. The deal also involves waiving about 1.5 billion yuan ($220 million) in intra-group debt owed by China Yinrui.

Executive education

Qidian Guofeng's zigzagging path reflects the background of its leader. Born in 1982, Yuan is a serial entrepreneur who tried his hand at online group buying and real estate brokerage, before making money out of property technology. With a flair for self-promotion, he later pivoted into corporate training, founding Shengshang Education (430277.OC) to teach the owners of small businesses. He also steered the company onto China's National Equities Exchange and Quotations (NEEQ), turning it into one of the better known players in the niche market for business training.

Shengshang Education has drawn plenty of controversy. It offered free seminars to attract customers then sold courses at escalating price points. Participants were encouraged to recruit others in exchange for commissions – a structure that critics have likened to a multi-level marketing system or even a Ponzi scheme.

Shengshang Education entered the Hong Kong market in 2022 through a reverse takeover, using a listed shell known as Qidian International.

Yuan then applied his experience in executive education and crafting compelling narratives to the combined company. He proved adept at capturing trends, packaging narratives and achieving rapid transformation, but the strategy demonstrated limited patience for long-term investment, technological barriers and industry depth.

Turning back to this disposal, China Yinrui's business of selling or trading home appliances across China depends heavily on a network of physical stores, with high fixed costs and heavy demands on working capital. As consumer appetite cooled and competition intensified, the business has been posting persistent losses.

China Yinrui was already insolvent by the end of 2025, according to the announcement. With a zero sale price and an intra-group debt waiver, the move is essentially a financial cleanup – stripping a legacy business and related risks out of the listed company to staunch the red ink and lighten the load on the balance sheet.

But the home appliance segment was also the company's biggest source of revenue in the first half of last year. For the six months ended June 30, nearly 70% of the overall revenue of 182 million yuan came from home appliances. The 124 million yuan of appliance income far exceeded the roughly 41 million yuan from education and training and 17 million yuan from liquor. Over the same period, the company posted a net loss of 19.29 million yuan, a narrowing of nearly 41% from the first half of 2024.

Once the disposal is completed, China Yinrui's results, assets and liabilities will no longer be consolidated into the group's financial statements. In other words, while the group chairman will retain control of the home appliance business through ownership of the buyer, the listed company will be giving up one of its main revenue engines.

Betting on AI?

About a week before the move was announced, Qidian Guofeng made a splash with another piece of news, reporting that its wholly owned subsidiary Shanghai Huiliu Network Technology had clinched a distribution deal with a rising star of the Chinese AI sector. The agreement with Metax (688802.SH), a domestic maker of graphics processing units, marked the group's entry into the market for AI computing hardware. The partner, dubbed a mini Chinese version of chip giant Advanced Micro Devices (AMD), listed on Shanghai's STAR Market in December. Its stock surged 700% on the market debut and is still trading at around four times the IPO price. But the distribution partnership is both non-exclusive and limited to just one year, perhaps explaining why Qidian Guofeng's shares slipped on the day the news was released.

That wasn't all. Last year the company moved into the crypto and blockchain world. In the second half of 2025, it bought a stake in an AI technology firm, then rolled out Real-World Assets (RWA), digital tokens representing physical or intangible assets, backed by inventory from its Chinese liquor business and shareholder equity. So far, none of these actions has translated into visible results.

The multifarious moves have not exactly won over investors. The stock gained just 0.4% the day after the disposal news and is still down roughly 31% over the past six months. As the chameleon keeps changing its color, jumping into new sectors while dumping old assets, investors may wonder what type of business it wants to be. Until that question is answered, Qidian Guofeng may remain a company that is perpetually on its way while never quite arriving.

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.