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Bloomberg

Ant valuation falls to $ 29 billion at worst

(Bloomberg) – Ant Group Co.’s valuation could plunge to $ 29 billion after becoming a financial holding, more regulated like a bank, compared to 30% in November, hurting earnings prospects, according to Bloomberg Intelligence analyst Francis Chan wrote in a report Tuesday. Ant’s valuation could fall from $ 320 billion to $ 29 billion to $ 115 billion, he predicts. Ant’s valuation could be similar to that of banks and other major financial institutions, Chan said. The fintech company faces constraints on all fronts, from online lending to payments to asset management and insurance. The company’s consumer credit units, Huabei and Jiebei, could suffer from their links being removed from Alipay, which has a billion users, Chan said. Ant will face more restrictions on access and use of personal information through credit research, he added. The company also needs to lower the balance of its wealth management service Yu’ebao, which fell 18% in the first quarter. “Ant Group’s future as China’s fintech giant could be marked by reduced size with or without Jack Ma,” said Chan. Ma currently holds a majority stake in the company. If Ant is viewed as a traditional lender, even a fast-growing one like China Merchants Bank Co., its valuation may not go beyond 487 billion yuan ($ 75 billion) to 492 billion yuan, Chan said. In the downside scenario, the market can rate Ant similar to the MSCI China Financials Index, which implies a value of 186 to 245 billion yuan. For more articles like this, please visit us at bloomberg.com. Sign up now to keep track of most trusted business news source. © 2021 Bloomberg LP

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