Alibaba loses $344BN in one year in world's biggest shareholder value wipeout

In a major stock fall, Alibaba Group Holding saw a dip of $344 billion in the world's biggest wipeout after its founder Jack Ma bluntly criticised the Chinese Financial System last year, Bloomberg reported. Since last October, the company lost a multi-billion dollar market capitalisation after Beijing suspended the listing of its fintech arm Ant Group shortly after the infamous speech by Ma. It is the biggest global shareholder value drop as per Bloomberg data compilation.

About three weeks ago, Alibaba's shares in Hong Kong sank the lowest ever recorded after an all-time high in the month. The sudden drop in stocks was a result of the Beijing-led crackdown of the company's practices followed by directions of immediate restructuring of Ant Group. Although stock recovered by 30% from October 5 this year, it is still 43% less than its October 2020 scores.

Notably, among other companies in the value losses list published on October 25, 2021, by Bloomberg, Kuaishou Technology sank by $104 billion, followed by Ping An Insurance Group Co of China Ltd ($66.1 billion) then Tencent Holdings and Zoom video Communications with $65 billion and $63 billion respectively. There are other China-based firms like China Life Insurance, K E Holdings, Soft Bank Group, TAL Education, and RLX Technology. 

Alibaba founder criticises Chinese finance system

For a recap, Alibaba founder Jack Ma widely slammed the global financial regulations of China for stifling innovation. In his infamous speech, he also urged Beijing to seek a system that accommodated growth and development. Speaking at the Bund Summit in Shanghai, Ma had said that "after the Asian financial crisis, the risk control highlighted in the Basel Accords were a priority for regulators," which has led to the world fixating on risk control rather than development. The Basel Accords are a set of agreements on banking regulations in the capital and operational market risks, as per Investopedia.com. He also noted the expanding market for digital currencies and stressed the need for moulding the financial system to establish a space for it.  Although, repercussions to his comments, Chinese regulators imposed a record fine of $2.8 billion on Alibaba for allegedly abusing its dominant position in the market last year. Earlier this October, Ma was last seen in Hong Kong leading a normal life and focusing on his hobbies and philanthropy.

Image: @AlibabaGroupOfficial_Facebook