Jack Ma appeared for less than a minute and said nothing about the Chinese government clampdown that had left his business empire in crisis.
But for investors who’d been waiting months to catch a glimpse of the tech tycoon, the entrepreneur’s participation in a live-streamed video conference on Wednesday was enough to trigger a $58-billion sigh of relief. That’s how much Alibaba Group Holding Ltd’s market value soared after a clip of Ma speaking to a group of teachers began circulating online - his first public comments since disappearing from view late last year.
Much about the future of China’s most famous businessman remains unclear. Yet analysts said that Wednesday’s video was a sign that worst-case scenarios — such as jail time for Ma or a government takeover of his companies — are probably now off the table. It’s unlikely Ma would have participated in the event without at least tacit approval from Beijing; State-run media including the Global Times were among outlets that posted snippets of his talk or wrote stories about his appearance.
“There’s still a lot of uncertainty on regulators’ next moves, but this does mean the status of Jack Ma is much better than a lot of people speculated,” said Fang Kecheng, a professor at the Chinese University of Hong Kong.
Ma’s talk focussed on philanthropic issues including the importance of narrowing income disparities and reviving China’s countryside, two big priorities for Xi Jinping’s Communist Party. While far from a mea culpa, the comments offered a stark contrast to Ma’s last public remarks in October, when the billionaire launched into an unusually strong rebuke of Chinese regulators and State-owned banks.
Antitrust probe
Just a few days after that now-infamous speech at the Bund Summit in Shanghai, the government torpedoed Ma’s plan to take Ant Group Co public in what would have been the world’s biggest-ever initial share sale. In the weeks that followed, authorities called for an overhaul of Ant’s business and began an antitrust probe of Alibaba.
Few expect Ma’s change of tone will cause Beijing to back off its campaign to more tightly regulate Ant, Alibaba and the rest of China’s high-tech giants. But Wednesday’s market response suggests investors are beginning to price out the risk of a crackdown that would put the country’s richest entrepreneurs and most innovative companies in serious jeopardy.
“Alibaba is not out of the doghouse, but at least it’s clear that the current anti-monopoly drive is not about punishing Jack Ma,” said Zhang Fushen, senior analyst at Shanghai PD Fortune Asset Management.
Ant, which is controlled by Ma and part-owned by Alibaba, confirmed the authenticity of the video but declined to comment further.
Ant had suffered a “considerable shock” after Beijing suspended its stock market listing, an event that was expected to value the company at over $300 billion, said James Anderson, a partner at Baillie Gifford, a significant investor in Alibaba. “It’s plain that there are less chances of it being extraordinarily profitable than there were before,” he told Bloomberg TV.