(Yicai Global) June 17 -- Koolearn Technology Holding slumped following a more than 500 percent rally in the Chinese education firm’s shares since June 10 that was sparked by online interest in its new strategy of mixing livestreamed English-language teaching with e-commerce sales.

Koolearn [HKG: 1797] closed 12.6 percent lower at HKD25 (USD3.19) in Hong Kong today, after plunging as much as 26.6 percent in the late afternoon. New Oriental Education & Technology Group [HKG: 9901], its biggest shareholder, fell 6 percent to HKD16.46. New Oriental’s New York-listed stock [NYSE: EDU] was 3.3 percent lower in pre-market trading as of 5.02 a.m. local time today, after ending 5.9 percent down yesterday.

The number of followers on Oriental Select, Koolearn’s new livestreaming studio on Douyin, TikTok’s sister app in China, exceeded 10 million yesterday, a week earlier than analysts had predicted. Its cumulative sales stood at CNY206 million (USD30.7 million) as of the same day, according to figures from data agency Chanmama.

New Oriental was forced to look for new revenue streams after China last year banned off-campus tutoring for students in compulsory education. The Beijing-based company launched Oriental Select, which mainly sells agricultural produce, at the end of December. The studio did not attract much attention before June 10, when it had just a million followers, but that changed with its innovation in livestreaming.

Companies are clamoring to sell their goods through Oriental Select. An executive at one brand hoping to partner with it told Yicai Global that the wait will be long -- until September or October. Douyin has also been supportive by pushing the livestreaming to more users, giving the room good exposure for brands, the person added.

Editor: Futura Costaglione