The giant Chinese fintech company Ant Group has finally attracted the attention of regulators. 

Reuters reported big news for the firm on Wednesday! Recently it was announced that China’s top securities give Ant Group permission to register its Shanghai offering. After having a lot of attempts now they finally reached their desired agreement and as a result, the company is going to hurdle for their great initial public offering (IPO) for no less than 35 billion USD. 

The news is more favorable for the company than anybody could have imagined because this listing will definitely set a new record as it’s going to be the largest initial public offering in the world. The previous record was set in December 2019 by Aramco, Saudi Arabia’s oil giant which was about 30 million USD. After December the things haven’t changed but now Ant Group deserved the public attention at last, as a new record is much greater than Saudi Aramco’s last result. Other than this, the reached IPO would probably be the first simultaneous listing in Hong Kong and on the whole STAR Market in Shanghai which is a major Chinese technology-focused equities market functioning effectively since 2019.

Ant Group is a child company of Chinese e-commerce group Alibaba and is actually one of the highest valued fintech companies in the world. It is 33% owned by this Chinese multinational technology company and is controlled by founder, Chinese business magnate, and popular investor, Jack Ma. As sources confirm, Ant Group is going to list simultaneously in Hong Kong and Shanghai in the following weeks and now it has official permission for doing this dual listing from the China Securities Regulatory Commission. 

So by this time Ant group is not only the financial technology giant but also the biggest IPO of the year. This means that changes are coming to the global stock market as they plan to split the stock issuance equally across Shanghai and Hong Kong markets and issue 1.67 billion USD shares in each of the countries. This is more than 10% of the total outstanding shares after the IPO. But it’s not everything and if the over allotment option will be exercised, the number of shares will grow even more. Besides, it’s important to mention that the Chinese financial giant also updated its IPO along with the information on the share structure. 

How will it affect the Chinese market?

Despite the company’s happiness about their achievement, the news may not be as favorable for other companies in China. Ant Group will cause some problems for its opponents because the company will likely split the Chinese digital payments market with Tencent's WeChat and leave absolutely no room for any other company to try its luck in the market.

Based on comments gathered from CasinoCrunch.com, it is actually quite likely that this agreement will snuff out any concerns for illegal online gambling in China. In most cases, people would deposit through cryptocurrencies to avoid detection, but that has also gone awry. Now, with the introduction of another large payment system not too much can be done to avoid the government's eye anymore. 

People suppose that this can be a major step towards promoting responsible gambling in China and eliminating gambling-related problems, but that’s what the general society thinks. However, people who actively take part in the gambling industry are not quite pleased about Ant Group’s achievements, as they will no longer have the ability to use cryptocurrencies and play online safely, without any lack of their personal information. From now on the government will control the Chinese player’s actions more easily and they will likely tighten the already-harsh regulations of the gambling sector even more. 

Ant Group’s future success

Ant Group is already considered as the most valuable company ever that has ever gone on a global stock exchange market. According to MarketWatch, they sold 10% of their shares on the Shanghai exchange and 5% on the Hong Kong stock exchange. However, raising a record-breaking 40 billion USD was not a surprise as it was expected to become a leader by its IPO in August. 

Now as CNBC reports, some of the authoritative Chinese investors decided to subscribe to 80% of Ant Group’s Shanghai-oriented A shares. Also, Alibaba said that the company agrees to buy $740 million A-shares using the subsidiary Zhejiang Tmall Technology, which means that it will be able to maintain its 33% stake in Ant Group. 

Therefore, the success of the Ant group continues and it’s believed that this listing will be one of the biggest of all time. They have already released updated financial figures for the first time in 2020 after the period of inactivity. According to the data, the revenue of Alipay, which is Ant group’s mobile payments application has increased from 711 to 731 million from June to September. And the actual revenue was more than 118 billion yuan, which is 42% of the year-on-year rise. 

How far will Ant Group go?

Some analysts believe that Ant’s valuations have the opportunity to exceed $20 billion and maybe even compete with some Wall Street banks shortly. Although the company is not well-known outside China, it’s expected that Ant’s valuation may exceed some of Wall Street’s big banks. By now the company was known for creating Alipay, one of CHina’s most effective mobile payment systems. But they have been expanding their reach, as they decided to start selling financial technology products and also, to take part in wealth management, insurance, or even micro-loans. Also, it’s going to use funds to support the digital economy businesses and develop research capabilities. 

Currently, Ant Group has more than 900 million Alipay users in China and is valued at $150 billion. Investors say that the listing will help the company to continue being on the list of the world’s giants in the following years and as they predict, Ant can become even larger than some of the biggest banks in the US, including Wells Fargo (WFC) and Goldman Sachs (GS).