Alibaba Group Holdings Ltd. The Ant Group’s valuation, supported by (NYSE: BABA), is estimated at around $ 108 billion, according to Bloomberg Intelligence.

What happened: That would be less than half of the estimated $ 250 billion valuation for Ant when it went public late last year.

According to Bloomberg analysts, China’s draft financial technology proposal is the main driver of this valuation slump.

According to analyst Francis Chan, the rating for the popular payment service Alipay from Ant in particular could be halved under the regulations.

“Ant Group’s valuation could fall further if its payment unit is forced to break up due to possible antitrust investigations by the Chinese central bank,” said Chan.

Why it matters: Ant has had problems with Chinese authorities since co-founder Jack Ma, the country’s most famous billionaire, commented on Chinese regulations at an event in Shanghai in October.

Ma lagged behind in increasing control but reappeared in public for the first time in months earlier this week.

Price action: Alibaba stock closed 2% lower at $ 260 in New York on Thursday.

Read on: Why Jack Ma’s reappearance isn’t enough to reassure Alibaba investors

© 2021 Benzinga does not offer investment advice. All rights reserved.