Alibaba’s Hong Kong-listed shares rose 4% on Monday morning.
Qilai Shen | Bloomberg | beautiful pictures
Alibaba’s Hong Kong Listed Stock Performance
In March, Alibaba announced a major restructuring of its businesses, which some analysts say could signal that the Chinese government may loosen its grip on the domestic tech industry.
“However, [regulators] have also highlighted the need for broader industry-wide regulations to effectively regulate the entire industry,” Oshadhi Kumarasiri, equity analyst at LightStream Research, said in a report. report published on the Smartkarma research platform.
“This suggests that optimism about ending regulatory oversight may be premature, as broader new regulations could be equally stringent,” Kumarasiri said.
Shawn Yang, executive director of Blue Lotus Research Institute, is price increase on Alibaba after the penalty of Ant Group.
“We calculate that Ant Group will be worth $89 billion ~ of which Alibaba’s stake is $29.4 billion ~ with their 33% ownership in Ant Group. We consider the valuation as So it goes against the consensus,” Yang said, referring to Bloomberg Valuations Ant Group only from $22 billion to $57 billion.
“In our view, [Bloomberg’s] pricing range is too low, as Ant Group is comparable to PayPal. With the end of deregulation for Ant Group, we suggest that it could be priced at multiples more similar to PayPal, which presents an advantage over Bloomberg’s valuation,” Yang said. speak.
On Saturday, Ant Group announced a share buyback valuing the company at $78.53 billion, according to state media CGTN. This is well below Ant’s $315 billion valuation when it tries to list in 2020.
Kumarasiri said that the acquisition “raises questions, especially if the company plans to IPO in the near future.”
“The company justification for the acquisition, including providing liquidity to existing investors and attracting/retaining talented individuals through employee incentives, seems unnecessary if The IPO is imminent.”
