Alibaba’s fintech affiliate Ant Group filed draft IPO prospectuses for a dual listing on the Shanghai and Hong Kong stock exchanges on Tuesday, the first simultaneous listing for a Chinese tech company. 

Ant Group is reportedly eyeing a $200 billion valuation, which would make it the world’s most valuable fintech company. Such a valuation would top those of some of the world’s biggest banks, including China’s big four. It could be one of the biggest IPOs in recent years, potentially topping Saudi Arabian state-owned oil producer Aramco’s $29 billion listing. 

READ MORE: Ant Group’s dual listing will be one of the biggest IPOs of 2020

Ant Group’s 674-page Hong Kong prospectus reveals the extent of its empire, risk factors related to geopolitical tensions, and financial regulations. Here are five key takeaways. 

1. Impressive profits and growth potential 

In the first half of 2020, the company earned RMB 72.5 billion in revenue, a year-on-year increase of 38%. Digital finance services drove growth, growing 56% year on year to RMB 46 billion in the period.

The company booked a net profit of RMB 21.9 billion in the first half, outstripping its RMB 18.1 net profit for all of 2019, according to the prospectus. 

Monthly active users of mobile payment app Alipay, Ant Group’s key asset, reached 711 million as of end-June, while transaction volume for the app reached RMB 118 trillion during the 12 months ended June 30.

The bulk of Ant Group’s revenue comes from its “Credittech” business, which operates a range of loan services targeting individuals and merchants. Credittech revenue grew 59.5% year on year in the first six months of the year to RMB 28.6 billion, accounting for 39.4% of its total revenue in the period.

Credittech’s key products include Huabei, a virtual credit card service; Jiebei, a micro-lending service targeting individuals; and Mybank Loan, which lends money to small and medium-sized businesses (SMB). The company said in the prospectus that the consumer credit balance of its loan businesses was RMB 1.7 trillion and the SMB credit balance was RMB 400 billion as of the end of June.

2. Looming #techwar

Ant Group warned investors that rising geopolitical tensions could seriously impede its business. It emphasized rising risks of sanctions and trade restrictions on Chinese tech firms from the US government. 

READ MORE:  Techwar: Trump to end transactions with Tencent and Bytedance in 45 days

Such restrictions have the potential not only to banish Ant Group from US markets, but also disrupt its ability to participate in the US dollar-led global financial system, the company said. 

The company singled out its cross-border payments business as exposed to such actions, adding that cross-border payments will be a key area of investment for Ant Group in the future. 

Some analysts have said that new listing restrictions in the US are the very reason that Ant Group didn’t list in the US, as Alibaba did with massive success in 2014. 

In June and July, four Chinese companies, including China’s US IPO pioneer Sina and online travel agency Ctrip, announced plans to delist from the US stock market. Big Chinese tech companies listed in the US have also started dual listing their shares in Hong Kong, signaling a retreat from US financial markets.

3. Jack Ma remains at the helm 

The fintech company has tried to distance itself from Alibaba founder Jack Ma and Alibaba in the past, insisting that it is an independent company. Yet Alibaba shares in New York jumped 3.6% Tuesday on the back of Ant Group’s IPO news. 

The prospectus said the billionaire entrepreneur is Ant Group’s “ultimate controller,” holding a 50.52% stake in the company. Information about Ma’s stake after the IPO is redacted in the draft prospectus. 

The Alibaba and Ant Group founder helms a limited liability partnership, which controls two other partnerships that are Ant Group’s biggest shareholders. 

According to the prospectus, Ma transferred 66% of the controlling entity’s equity shares to Ant Group’s leadership on Aug. 18. He divided it equally between Eric Jing, the company’s executive chairman, Simon Hu, the CEO, and Fang Jiang, a non-executive director. 

Ant Group also recognized that its success is closely linked to Alibaba. The prospectus says Alibaba, mentioned 650 times in the document, is a “major shareholder,” and the prospectus reports that the two have a data sharing agreement. It lists conflicts of interest between the two giant companies as a risk factor, highlighting the fact they have “overlapping” user bases. 

There are “no assurances,” the prospectus says, that Alibaba won’t try to compete with  its fintech twin. 

4. Mounting regulations 

The prospectus warns of tightening regulations in key business segments for Ant Group, both globally and in China: payments, investment, insurance, and credit, among others. 

It makes special reference to China’s tightening anti-monopoly laws: Authorities have in recent years “strengthened enforcement,” it said. 

China’s central bank is reportedly not happy about Ant Group and Tencent’s hold over the domestic digital payments market through Alipay and Wechat. In late July, Reuters reported that Chinese regulators are preparing for an antitrust investigation in the two apps. 

READ MORE: INSIGHTS | China’s digital currency has a long way to go

The digital yuan’s e-wallet is expected to compete with the effective duopoly, possibly breaking Ant Group and Tencent’s chokehold on the market. 

“If we fail to adapt to these new initiatives in a timely manner, our business, financial condition, and results of operations may be materially and adversely affected,” the company said in reference to the digital yuan. 


Ant Group’s IPO filings are not final, and many pieces of crucial information were redacted, including the number and price of shares, and the company’s total valuation. 

“The A Share [REDACTED] comprises an [REDACTED] of initially [REDACTED] A Shares for subscription, representing approximately [REDACTED]% of our total outstanding Shares following the completion of the H Share [REDACTED] and the A Share [REDACTED], assuming that the [REDACTED] are not exercised.” 

Ant Group in its draft IPO prospectus filed at the Hong Kong Stock Exchange

Eliza was TechNode's blockchain and fintech reporter until July 2021, when she moved to CoinDesk to cover crypto in Asia. Get in touch with her via email or Twitter.

Writing about semiconductors and telecommunications.