Ant Group finalizes the details of its imminent IPO, which could be the largest in history. Their representatives have delivered today the documents required to jump onto the market in Hong Kong and Shanghai. Ant is a subsidiary of the technology giant Alibaba, the seventh largest company in the world by market capitalization and specializes in electronic payments and financial products.
The electronic payments sector has developed at full speed in China. The volume of transactions in 2018 reached 227.4 billion yuan (29.542 billion euros) according to data from the People's Bank of China, a figure 28 times higher than that of five years ago. The institution prepares for this year what will be the first national digital currency. Ant's app, Alipay, has been one of the key players in this process; along with its great rival, WeChat, owned by Tencent.
Alipay was born in 2004 as a tool to facilitate mutual trust between consumers and sellers on Taobao, Alibaba's e-commerce platform. Since then, its growth has been unstoppable: the app has more than 900 million users in China and the QR codes with which payments are made can already be seen in stores around the world.
Once the use of Alipay to pay for consumer products and accumulate savings became popular, this opened the door for Ant to start offering its users financial products such as loans, investments and insurance, all of them personalized in detail, thanks to the accumulated information on user behavior after thousands of transactions.
Revenue from this business amounted to 72.5 billion yuan (8.9 billion euros) in the first half of the year, an increase of almost 40% compared to the same period in 2019. Unlike many other technology companies, Ant does not only it does not record losses, but its profit margins are enormously wide: last year it reaped profits of 2.1 billion euros. In the first half of this year there are already 2,700, according to the figures presented today.
Its IPO is expected to mark unprecedented heights. Already in a financing round carried out two years ago, his business was valued at 126,000 million euros, which made it one of the most valuable private companies in the world. These operations will mark the third and fourth public offering for sale for Alibaba, whose debut in New York in 2014 was an enormous success - the largest in history at the time -, a move repeated late last year in Hong Kong. On this occasion, the board has chosen to turn its back on the United States in favor of national indices, further proof of how financial markets protect themselves against the progressive deterioration of relations between the two superpowers.
