Ant Group has filed for an initial public offering (IPO) of stock that could be the largest in history.
The company's filing with the Hong Kong Stock Exchange said its shares will be listed in the financial hub and in Shanghai. Ant is the parent company of Alipay, which says it has more than 1 billion users with its online and mobile payments platform.
Ant Group, a Chinese FinTech, had reported profits of 9.2 billion yuan ($1.3 billion) in the first fiscal year quarter. That was up 560 percent over the same period one year ago.
Chinese billionaire Jack Ma's Alibaba Group Holding owns one-third of Ant, which is aiming for about a $225 billion valuation. Alibaba recently reported results that suggested it benefited from the digital shift that the pandemic has sped up.
The Wall Street Journal reported that Ant had 21.2 billion yuan ($3 billion) in net profits for the first half of the year with revenues hitting 72.5 billion yuan. The Journal said: “That implied a net profit margin of around 30 percent, fairly high for a relatively young company that is growing rapidly.”
Alipay, launched in 2004, was created to facilitate payment transactions on eCommerce sites operated by Alibaba. Since then, Alipay has turned into a payments provider for a range of online, in-store and other retail and business transactions.
Alibaba’s New York IPO raised $25 billion in 2014. Ma controls 50.5 percent of Ant’s voting rights, the Journal said.
Chinese consumers use Alipay for a wide range of financial transactions. More than 80 million businesses use its mobile app.
The Journal reported that about 43 percent of Ant’s revenues last year “came from what the company called digital payment and merchant services.” Alipay charges fees to businesses based on a percentage of their transaction volumes.
Most of Ant’s other revenue comes from what it calls its digital finance technology platform, the Journal said. The platform charges technology-service fees to banks, asset managers and insurance companies that use Alipay to do such things as making loans, selling mutual funds and offering insurance.