<div id="readability-page-1">The company is trying to attract investors with its high-tech and robotic products for smart swimming pools, even as its recent financials look lackluster <h4>Key Takeaways:</h4> <ul> <li>Fairland has filed for a Hong Kong listing, disclosing it fell into the red last year with a 120 million yuan loss</li> <li>The smart swimming pool equipment supplier’s gross margin has fallen steadily in the last three years, as it lowers prices to stay ahead of the competition</li> </ul> By Cheng Sui Tong Market optimism over a deal to end the U.S. and Israeli war against Iran, combined with strong recent trading debuts, are keeping the Hong Kong stock market rally alive well into its second year. Into that mix comes a new IPO application by Fairland Corp. Ltd., which hopes to seize on strong appetite for high-tech and robotic offerings to attract investors to its business selling equipment to make swimming pools just a tad smarter. While its concept is relatively unique, the company still lacks many of the hot themes that have captured investor imaginations lately. But that hasn’t stopped Fairland from trying to boost its appeal by positioning itself as the latest technology play for Hong Kong investors. Its preliminary prospectus describes Fairland as a technology company building an “integrated smart garden ecosystem” focused on the “garden vertical scenario.” In simpler English, the company makes products that do things like manage energy, pump and heat water, clean and chlorinate swimming pools. Such products currently account for about 80% of its revenue. That’s not to say Fairland isn’t high-tech. Its equipment leverages internet of things (IoT) capabilities to integrate various combinations of its products, enabling more efficient and lower-cost pool maintenance. Fairland developed its iGarden ecosystem to address common issues like seasonality, high energy consumption and expensive upkeep for swimming pools. The system uses IoT technology to coordinate water pumps, heat pumps, salt chlorinators and other equipment, which it says maintains water cleanliness and slashes maintenance costs, allowing people to operate their pools year-round. <h4>Robotic offerings</h4> The company is also heavily promoting its robotic offerings, playing to a theme that’s wowed Hong Kong investors with both embodied robots that can dance and do martial arts, as well as more practical models that can fetch items from warehouse shelves. Fairwood is touting its wireless intelligent pool cleaning robots that act as automated pool butlers, eliminating manual cleaning hassles. It later adapted the technology for lawn care, creating intelligent mowing robots. However, its robotics segment currently contributes just 10% of its revenue. According to third-party market data in its listing document, the penetration rate for global smart equipment among swimming pool owners rose from 11.7% in 2020 to 14.9% in 2024, and is projected to rise further to 21.6% by 2029. As that happens, the global market grew from $1.75 billion in 2020 to $3.1 billion in 2024, representing 15.4% annual growth, which is expected to continue through 2029. Fairland is currently China’s largest smart pool equipment manufacturer, holding 3.4% of the global market. <h4>Surging sales expenses</h4> While the company’s revenue has grown consistently over the past three years, including a 33% rise last year to pass the 1 billion yuan mark, its bottom line has performed less swimmingly. The company rose from a loss of 15.69 million yuan in 2023, to a profit of 24.19 million yuan in 2024, only to sink back into the red with a 120 million yuan loss last year. Last year’s steep loss stemmed partly from a declining gross margin, but was mostly due to a 160% surge in sales and distribution expenses to 216 million yuan. The company blamed two major factors behind the rise. One was a substantial expansion of its sales and marketing team, which caused employee compensation costs to soar. The other was its launch of direct sales channels, including its own website, alongside other marketing campaigns, which significantly boosted its spending on advertising and promotions. The company’s gross margin has also declined steadily over the past three years, dropping from 36.9% in 2023 to 36.1% in 2024, and falling further to 33% last year. The erosion was mainly driven by intense competition, leading to regular price cuts that undermined profitability. The average selling price of Fairland’s smart pool energy management products — including heat and water pumps — fell from 5,648 yuan in 2023 to 5,065 yuan in 2025, a drop of about 10%. The company blamed the downward pressure on pricing adjustments for its smart pool heat pumps aimed at boosting its presence in North America. <h4>Steadily falling prices</h4> Similarly, the average selling price for Fairland’s robotic products also dropped from 3,083 yuan in 2023 to 2,570 yuan last year, causing the segment’s gross margin to plummet from 20.6% in 2024 to just 3.3% in 2025. Prices for its water treatment systems also declined from 4,412 yuan to 3,402 yuan over the same period. The company’s profitability is also highly susceptible to raw material prices, which accounted for 88.4% of its cost of sales in 2025. Its key materials and hardware components include circuit board assemblies, motors, metals, plastics and packaging materials. At the same time, Fairland must spend fairly large sums on R&amp;D to stay competitive in its niche. Its R&amp;D expenses have generally trended upward as a proportion of its revenue, rising from 13.3% of the total in 2023 to 14% last year. Fairland is somewhat unique in its positioning in the smart pool equipment niche. Tianjin-based Wybotics, a similar business focused mainly on pool-cleaning robots, filed for a Hong Kong IPO last September, but has yet to list more than half a year later. Wybotics is the world’s biggest pool-cleaning robot manufacturer, with 2024 revenue of 544 million yuan and a profit of more than 70 million yuan that year. Despite its smaller size, Fairland is hoping for a first-to-market premium it might command if it can beat Wybotics to an IPO, which could make it Hong Kong’s first pure-play smart pool stock. Still, the company will have to address concerns from skeptical investors over its eroding prices and declining gross margins. To subscribe to Bamboo Works weekly free newsletter, click here</div>

恆生指數

Fairland 的首次公開募股（IPO）未能吸引投資者，因其財務表現不佳。該公司在香港上市申請中披露，去年虧損 1.2 億元，且過去三年毛利率持續下降，因其降價以保持競爭力。儘管市場對結束美國和以色列與伊朗之間戰爭的協議持樂觀態度，香港股市仍在強勁的交易首日中保持上漲。

Fairland IPO fails to impress with dive into the red, sinking margins