Chinese innovation stocks led gains in Asia-Pacific on Wednesday’s as Hong Kong noted shares of Alibaba leapt, one day after the business revealed a significant revamp to divide the tech giant into 6 entities.
The Hang Seng Tech index got almost 3% in the afternoon, its greatest in more than a month– as shares of Alibaba and its peers such as Meituan, JD.com and Tencent rose the index.
Analysts state Alibaba’s significant overhaul will likely put the spotlight back on Ant Group’s record-breaking IPO, which was all of a sudden suspended in November 2020.
Alibaba owns 33% of Ant, which runs AliPay, among China’s 2 dominant mobile pay apps.
” I genuinely think [Alibaba is] going for a larger target,” stated Kingston Securities Executive Director DickieWong “In regards to the larger image, clearly would be Ant Group [being] reintroduced into the equity market,” he informed CNBC’s “Street Signs Asia” on Wednesday.
“This is probably the biggest goal for Alibaba Group itself,” Wong stated of Alibaba’s revamp strategies, including that the anticipated listing in Hong Kong will not take place anytime quickly “but there’s big hope” for a sooner-than-later offer.
HANGZHOU, CHINA – OCTOBER 27: A logo design of Ant Group is seen at the business’s head office on October 27, 2020 in Hangzhou, Zhejiang Province of China.
Vcg|Visual China Group|Getty Images
Ant got approval from the China Banking and Insurance Regulatory Commission previously this year to broaden its customer financing service, an indication the business might be moving one action more detailed to dealing with regulators’ issues.
To be clear, there was no reference of Ant in Alibaba’s statement for its overhaul over night.
KraneShares’ CIO Brendan Ahern stated financiers it’s most likely financiers will be focusing Ant’s IPO.
“The one part about the press release that I think the investors will be asking for is the lack of talk about Ant Group,” Ahern stated.
“But certainty the renewed relationship or the good graces of Alibaba along with the government and its regulators is really driven by China’s necessity for domestic consumption in 2023,” he included.
— CNBC’s Evelyn Cheng, Arjun Kharpal added to this report.
