Report: Ant’s valuation could nosedive to $29b after turning into financial holding firm

Details:

• Due to new rules imposed by Chinese regulators, Ant Group’s revenue growth is expected to be in the lower teens compared to the 30% it posted in November 2020. This would drag down the company’s profit prospects, according to a senior financial analyst at Bloomberg Intelligence.
• The analyst added that Ant’s valuation could plunge from US$320 billion to anywhere between US$29 billion to US$115 billion – a figure that’s closer to the valuation of banks and other financial institutions.

Context:

• Recently, Chinese regulators asked Ant Group to overhaul its business into a financial holding company that could be regulated more like a bank.
• The fintech giant is reportedly exploring options for founder Jack Ma to divest his stake in the company and give up control.