/ thematic-hk

The Lone Hydroponic Stock in HK

In 2017 I was involved in a proposal to turn a plot of farmland in Hong into a hydroponic farm. While the project never took off, I spent a lot of time researching the industry and appreciating how far agricultural technology has come. It’s a much more ecologically sustainable method of feeding humanity, especially urban populations. Fun fact; Elon Musk’s brother, Kimbal Musk has a container hydroponic company.

Hydroponics is a type of farming that grows plants in water, rather than soil. Counterintuitively it uses less water than soil so it’s more ecologically friendly. Growth rates are typically 30–50% faster and yields are higher.

If you’ve heard of vertical farms before, most likely they were using hydroponics. Vertical farms are well suited to urban environments where space is limited. They are also very efficient and often use LEDs to cultivate vegetables in an enclosed, climate controlled environment.


While Hong Kong doesn’t have a big farming industry, it got me thinking whether there are any listed stocks that are involved in the hydroponics space.

We screened for variations on the words ‘hydroponics’ and ‘vertical farming’ across of the latest annual reports, expecting 0 companies to turn up. While we got 5 hits, we only found 1 company that was really engaged in the hydroponics industry.


0808 Prosperity REIT — Prosperity REIT is a real estate investment trust formed primarily to own and invest in commercial properties, with exposure to the office and industrial office sectors in Hong Kong. They mention hydroponics in their ESG report where they arranged an ‘environmental awareness day’ with underprivileged local students and visited a vertical farm. [Latest Annual Report]

0312 Shirble Department Store — Shirble owns and operates department stores across Southern China, offering a wide range of products that includes groceries, daily commodities, electronics, designer clothing, stationary, and maternity- and baby-care products. As part of their groceries offering they mention that they sourced some hydroponically farmed vegetables from Guangdong. [Latest Interim Report]

8510 Top Standard — Top Standard Corporation operates restaurants in Hong Kong. They run two Japanese restaurants under the brand ‘Ronin’ (浪人), a Chinese restaurant under the brand ‘San Xi Lou’ (三希樓), and a vegetarian restaurant under the brand ‘Pure Veggie House’ (心齋). Some of the vegetables at Pure Veggie House are sourced from hydroponic farms. [Latest Annual Report]

1656 ISDN Holdings — ISDN Holdings is a engineering services company. The Company designs, produces, and sells motion control, industrial computing, and other related engineering services. They have another listing in Singapore. The term ‘hydroponics’ comes up in their table of subsidiaries – they have a wholly owned subsidiary called ‘Dietionary Farms Sdn Bhd’ in Malaysia which “Carr[ies] out hydroponic growing with the application of our in-house motion control solutions”. We couldn’t find much information on this subsidiary though and it appears to have a negligible impact on the balance sheet. [Latest Annual Report]

The Lone Hydroponic Stock

8059 Glory Flame Holdings — The company’s roots are in concrete demolition and LED exporting. These two divisions still account for 85% of the company’s revenues.

However, in recent years the company has made strides in entering Clean Coal Trading and the trading of Agricultural Equipment. Included in the latter is a micro-hydroponic farm that is meant for personal use at home. It’s an interesting angle for the company as the ‘cabinet system’ uses LEDs to cultivate the plants — and the company already has expertise in LEDs.

The sales efforts have been focused on direct-to-consumers in Chinese cities, as well as selling racks through distributors to restaurants. Sales from this segment currently account for 5% of revenues and stand at HKD9.1 million. Revenue growth is impressive, up from HKD640,000/0.04% of revenues in the previous year.

While exposure is low, it is really the only stock close to being a play on hydroponic agricultural technology.

[Latest Annual Report]

No real surprise that there weren’t any real hydroponic plays. However, it’s encouraging to find Glory Flame Holdings making inroads into the market. For a broader analysis it might be interesting to see if agricultural technology as a broader theme is making its way into Hong Kong listed stocks.

The Lone Hydroponic Stock in HK
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