Ant Group emerges as ‘less finance and more tech’ two years after mega IPO was called off, analysts say in wake of ESG report

Chinese fintech giant Ant Group has morphed into a different company from the one painted in its 2020 initial public offering prospectus, with a heavy tilt towards tech and away from finance, according to analysts and information contained in the firm’s latest social and governance report.

Ant, which has been under a state-guided restructuring process since its IPO in Shanghai and Hong Kong was called off in 2020 amid regulatory uncertainty, last week published an environmental, social and governance report which indicated a clear pivot towards technology.

Ant, an affiliate of Alibaba Group Holding which also owns the Post, will now focus on the following “four pillars”: digital inclusion, low carbon, technological innovation and an open ecosystem.

While not containing an update on Ant’s financial status, the report does shed fresh insights on the company’s strategy and priorities after a lengthy rejig, said analysts and industry researchers.

Han Hongling, a professor at Zhejiang University, wrote in an article that the Ant report is a “very important strong signal” about the group’s strategic reorientation, which may have implications for China’s business community. Han’s article was published on the website of China’s national radio station.

Lyu Peng, a digital economy researcher with the Chinese Academy of Social Sciences, was quoted by official news portal China.com.cn as saying that Ant’s pivot towards technology was “in line with expectations” as the government wants Big Tech to do more to bolster the country’s overall economic development.

Ant said its research spending grew at an annual rate of 39 per cent for three consecutive years from 2018 to 2021, with research investment in 2021 exceeding 18.8 billion yuan (US$2.82 billion).