As IPO looms, you need to know about Jack Mana Ant Group

Photographer: Kilai Shane / Bloomberg

Billionaire Jack Ma The ant group is preparing to pull off what could be the largest initial public offering fur ever by listing together in Hong Kong and Shanghai. It is said to operate a gun for evaluation 5 225 billion, making it the fourth largest financial company in the world.

Offshore out of 2011 Chinese giant Alibaba Group Holding Limited, the pay firm has defined and dominated the Chinese payment market through its ubiquitous Ellipse application. It also operates the huge Uaabao Money Market Fund and Huawei and Gibei Consumer Loaning Units.

Located in Hangzhou, a metropolis extending south of Shanghai, its ambitions run deeper than just money. Here is a thumbnail look at the challenges facing business units and pay.

Alipay: A Tr 17 trillion machine

The world’s largest digital payment platform was created in 2004 as an escrow service Alibaba to secure transactions on the e-commerce site. Payments To warn customers about online payments, the service was a hit and quickly spread to other platforms.

The mobile version, launched in 2009, once had a 75% market share, but with it has seen a slide of about 55% in its competition. Vechat Pay of Tencent Holdings Limited.

Alipay has 711 million active users, mostly in China, who tap to buy everything from instant coffee to real estate, paying 17 17 trillion in the 12 months to June. But it is also becoming less and less important to the ant and has contributed 36% to its revenue in the first half of this year, up from 50% just two years ago.

Losing ground in the payment market was one of the reasons that ants Already called for an earlier plan for an IPO in 2017, acquaintances at the time said. Now it is a much more diverse company.

Hubei and JBB: A Lone Feast

For those who do not have cash to spend through Alipay, Ant runs services that cover small unsecured loans: Hubei (Just Spend) and Jibei (Just Land). The former focus on fast consumer loans for the purchase of iPhones and fridges, while the latter provide money for anything from education to travel.

Ant uses some of its capital for this loan, but most of the money comes from banks, with the firm acting as a gateway. The platform almost makes a loan In the 12 months from June, 500 million people charge annual rates on small loans, as much as 15% of it. Their lending could reach about 2 trillion yuan by 2021, According to Goldsmith Group Inc.

In the company’s credittech business, which includes Hube and GB, it is the single largest revenue generator, contributing a total of% of% in the first six months of the year.

The company is now applying for a license to set up a consumer finance company. The new entity will increase the lending capacity of the entity as consumer finance companies are allowed to lend their capital 10 times compared to two to three times the profit of the existing micro-loan companies.

Anatomy of the Chinese Financial Powerhouse

Jack Mano has turned to tech giants and services

Sources: Data compiled by Ant Ant Group, Goldman Sachs, Bloomberg

Uebao: The Great St.

With hundreds of millions flocking to Alipay, Ante created a money market fund in 2013 that allowed people to earn interest on cash parked in the app, investing as little as 1 yuan. The Tianhong Yu’o Bao Money Market Fund is almost one of the largest in the world with it Assets 173 billion assets. But it has shrunk since its inception by regulators Limit how much each investor can put into the fund.

In 2018, Ant opened the platform to third parties. It now offers funding options from more than 20 asset managers. It has partnered with companies including Invesco Ltd., a fund that has grown 300 to 400 times in size by March. This year, together with the ants The Vanguard Group will offer a robot advisor to let the US giant move forward in China.

The unit participating in Uebao Ant has a 15% revenue share this year, the same as in the previous three years.

Credit scoring

Ants launched a credit scoring service called Zima Credit in 2015, using the vast amount of data it collected on cost and lending patterns. If users prefer the service, the ant checks on transaction history and also uses data from third-party providers to verify credit eligibility. Ants charge companies that charge a fee for the service and if customers score high enough, they can avoid paying a deposit on everything by renting a bike or booking a room in a hotel. Marriott.

Xianghubao: Insurance for pennies

Ants make many powerful colonies. The company entered the insurance market in 2019, creating a health care product called Xiangubao, which allows people to pay a small monthly fee to help cover the treatment costs of members suffering from diseases such as cancer, Alzheimer’s and Ebola.

Antony Insuretech also sells insurance premiums from third-party companies, and it makes cuts. Unit revenue rose 47% to 6 billion yuan in the first quarter, accounting for 8% of total sales.

Rising stars

Ant Group to join the top sector of global financial companies after mega IPO

Source: Bloomberg

Global headwinds

The ant’s U.S. Had grand plans for, but due to growing trade and political tensions between the world’s two superpowers it has now been put on ice. In the U.S. in 2018. Promised to create 1 million jobs in

Instead, Ant has focused on troubled ambitions to increase its presence in the rest of Asia, where it is working with nine payment startups, including Paytm in India and owners of JKesh in the Philippines, targeting billions. It also seeks to build more merchants abroad to use Alipay, so that its Chinese customers can use it while traveling.

Controversies: Yahoo!