Jack Ma, who is listed as the richest man in China, witnessed his net worth dwindling by almost $11 billion since the end of October as China stepped up scrutiny of his empire and the country’s tech behemoths. The 56-year-old former English teacher, who founded the e-commerce giant Alibaba in his Hangzhou apartment in 1999, has reached a peak of $61.7 billion this year and was aiming to recapture the title of Asia’s wealthiest person. However, the entrepreneur’s fortune took a beating with the fortune at $50.9 billion and the business leader slipping to 25th position on the Bloomberg Billionaires Index, a list of the world’s 500 richest people. Also Read: ITR Filing Last Date: File Online Returns By December 31, 2020. Check Step-By-Step Process Here
It is not that Jack Ma’s stocks have taken a hit but several other firms in the online domain are also feeling the heat.
Why such a decline in net worth?
As a result of increased government scrutiny, investors are rethinking their holdings even as the demand for online services during coronavirus has seen certain stocks surging earlier this year.
As per the Bloomberg report, in recent weeks, China’s technology giants have lost hundreds of billions of dollars in market value. Pony Ma’s Tencent Holdings Ltd. witnessed 15% slip since early November and Wang Xing’s food delivery giant Meituan is down by almost a fifth from its peak last month. Alibaba’s American depositary receipts have declined more than 25% since late October.
The anti-monopoly drafted guidance and antitrust review are some of the factors impacting the stocks. Authorities also asked Alibaba-affiliate Ant Group to rectify the company’s lending, insurance and wealth management services.
The problems cropped up when Jack Ma was about to take its payments company Ant Group Co. public. Instead, Chinese regulators halted what would have been the world’s largest initial public offering before its scheduled debut in November.
The halt of Ant’s $35 billion IPO was one of the first signs of China’s crackdown on an industry that’s gained influence over the daily lives of hundreds of millions. Later, the nation’s authorities slapped additional restrictions on the consumer-lending sector, proposed new rules to curb the dominance of internet giants, and fined Alibaba and a Tencent unit over acquisitions from years ago. Closer government scrutiny of mergers and acquisitions could add uncertainty to the growth of the internet behemoths.