Ant Group’s mutual fund unit sees sharp drop in profits amid regulatory clampdown and economic headwinds
- The mutual fund’s revenue for the half year also dropped nearly 7 per cent from 5.8 billion yuan
- Sharp decline in fund’s profit came as a slowing economy hurts earnings at Chinese funds and as Ant Group continues its state-led restructuring
Ant Group, the Alibaba Group Holding-affiliated operator of popular Chinese mobile payment service Alipay, saw its mutual fund unit’s net profit for the first half drop more than 70 per cent, as economic headwinds and regulatory pressures took their toll.
Ant (Hangzhou) Funds Sales, the mutual fund distribution arm of Ant Group, recorded a net profit of 82.85 million yuan (US$12.1 million) in the first half of the year, a 74.5 per cent decline from the first half of 2021, according to the latest financial results published by Shanghai-listed Hundsun Technologies.
The mutual fund’s revenue for the half year also dropped nearly 7 per cent from 5.8 billion yuan to 5.4 billion yuan, the company’s report shows. Ant Group is a shareholder in Hundsun, a financial software provider focused on wealth and asset-management solutions.
The sharp decline in the fund’s profit came as a slowing economy hurts earnings at Chinese funds, and as Ant Group continues to undergo a lengthy state-guided restructuring process after its initial public offering was called off at the last minute by Chinese regulators in late 2020.
The unit’s contribution to Alibaba’s net profit in the second quarter also declined 17.3 per cent from the same period last year.