(Yicai) Feb. 1 -- Shares of East Buy Holding jumped after the Chinese livestreaming e-commerce site operator’s chief executive officer and parent company New Oriental Education and Technology Group pledged to buy HKD700 million (USD89.6 million) worth of East Buy shares.

East Buy [HKG: 1797] closed 7 percent up at HKD24.60 (USD3.15) in Hong Kong today. Shares of New Oriental [HKG: 9901] rose 2.9 percent to HKD61.15.

New Oriental and Yu Minhong, who is also New Oriental’s founder and chairman, will buy HKD660 million and HKD40 million (USD5.1 million) worth of East Buy shares, respectively, in the next 12 months, according to a joint statement released yesterday by the two companies.

East Buy’s stock price is underrated, so it cannot reflect the firm’s value, New Oriental’s board said.

As East Buy sold its education business to New Oriental for CNY1.5 billion (USD209.6 million), it now has enough cash to provide funds for its long-term operation, the pair noted.

East Buy’s revenue jumped 34 percent to CNY2.8 billion in the six months ended Nov. 30 last year from a year earlier, according to the Beijing-based firm’s earnings report released on Jan. 24. Net profit slumped 57 percent to CNY249 million (USD34.8 million).

“East Buy is still growing, and its growth is not that stable to bear unexpected turbulence,” Yu said during the earnings conference call. “I will continuously guide East Buy’s development direction as a veteran helmsman.”

Editor: Futura Costaglione