If JD Tech Is Getting Back on IPO Track, Could Ant Group Be Next?

If JD Tech Is Getting Back on IPO Track, Could Ant Group Be Next?

Key Takeaways:

  • Reports are circulating that Chinese securities regulators are reviewing JD Technology’s IPO application, and that the firm’s investment bankers have resumed work on the listing
  • Meanwhile, Ant Group has taken a potential step towards a revived IPO after boosting the registered capital of its consumer finance arm from 8 billion yuan to 18.5 billion yuan, with two state-owned enterprises among the new investors

By Fai Pui

Two years ago, Ant Group was set for a $300 billion IPO, before owner Jack Ma delivered a blistering speech about China’s financial system. In the ensuing storm, the listing was pulled and a sweeping regulatory crackdown targeted parent company Alibaba Group (NYSE: BABA) and fellow stars of the digital economy.

Among those told to overhaul their business practices were JD Technology, the fintech arm of JD.com (NASDAQ: JD), and WeChat Pay, owned by Tencent Holdings (0700.HK).

But there are signs of a regulatory thaw that could unfreeze some of the fintech IPO plans.

According to a Reuters report, the international business department of the China Securities Regulatory Commission (CSRC) recently decided to look afresh at JD Technology’s application to list on the Hong Kong Stock Exchange, with input from other regulators. The company’s investment bank resumed its work on the IPO in October, with the green light expected to come as early as the end of this year. But the fundraising target may need to be scaled back from the previously reported $2 billion, given weak market conditions.

The brighter prospects for JD Technology have fueled speculation that the regulatory crackdown on the fintech sector has entered its final phase, potentially clearing the way for Ant Group, which had aimed to list in Hong Kong and Shanghai, to resume its IPO journey.

After the P2P lending market crumbled in China, almost all the related financing platforms came under tighter scrutiny. But Ivan Chow, an independent equity analyst, says that this wave of regulatory curbs on the fintech sector looks to be ending, after the central bank last year issued a plan to develop …

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