Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Victor Galliano is an experienced equity banks analyst, having covered Latin America banks and non-bank financials for over 12 years, as well as more recently covering the Italian banks. He has worked in sell side equity research for 30 years in a career spanning Barclays, HSBC, BBVA LatInvest, Barings and NatWest.
Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.
The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Financials & FinTech research

Ant Group: Regulatory Pressures Drive the State’s “big Data” Grab, and a Revised SOTP Valuation

Alibaba (BABA US) & Ant Group: PBoC Proposals Threaten Tighter Regulations

Alibaba (BABA US): Unloved but Undeterred

Ant Group: Limited but Positive 3Q20 Data Disclosed

Ant Group: SOTP Valuation Scenarios Revisited

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ant-financial-services-group" target="_blank" data-smartkarma-citation="entities:24240:1" rel="noopener">Ant Group (6688 HK)</a> was due to start trading on Shanghai Stock Exchange’s STAR board and on the Hong Kong Stock Exchange on 5<sup>th</sup> November</li>
<li>Shanghai Stock Exchange has temporarily suspended the listing, and the H shares listing on HKEX has also been halted</li>
<li>At an interview on Monday with regulators, Ant’s senior executives were informed that the Group may not meet Shanghai Stock Exchange’s listing or disclosure requirements, and also stressed important changes in the fintech regulatory environment</li>
<li>The Chinese regulators are justifying their actions by emphasizing the importance of financial stability, ahead of innovation; yet we believe that the timing  of this move by the authorities is intended to send a message to Ant chairman Jack Ma</li>
<li>The message implies that regulatory requirements for Ant Group are tightening, and that the most obvious constraint and revision to its business model would be in the credit (CreditTech) division, where we expect the regulator could impose higher capital requirements</li>
<li>In addition, we also believe that there is a “big data” angle to the confrontation between state and Ant Group, given that the PBoC is trialling its own central bank digital currency</li>
<li>Potential IPO Investors will be looking for clearer regulatory guidelines, especially in the credit operations, to have a greater degree of comfort and confidence in the group’s profitability and growth prospects, and this may require comprehensive revisions to the prospectus</li>
<li>The risks to the Ant Group IPO’s success and its fundamental are largely regulatory, along with a worsening of geo-political tensions and any potential worsening of the Chinese macro-economic outlook</li>
</ul>



Ant Group (6688 HK) was due to start trading on Shanghai Stock Exchange’s STAR board and on the Hong Kong Stock Exchange on 5th November
Shanghai Stock Exchange has temporarily suspended the listing, and the H shares listing on HKEX has also been halted
At an interview on Monday with regulators, Ant’s senior executives were informed that the Group may not meet Shanghai Stock Exchange’s listing or disclosure requirements, and also stressed important changes in the fintech regulatory environment
The Chinese regulators are justifying their actions by emphasizing the importance of financial stability, ahead of innovation; yet we believe that the timing  of this move by the authorities is intended to send a message to Ant chairman Jack Ma
The message implies that regulatory requirements for Ant Group are tightening, and that the most obvious constraint and revision to its business model would be in the credit (CreditTech) division, where we expect the regulator could impose higher capital requirements
In addition, we also believe that there is a “big data” angle to the confrontation between state and Ant Group, given that the PBoC is trialling its own central bank digital currency
Potential IPO Investors will be looking for clearer regulatory guidelines, especially in the credit operations, to have a greater degree of comfort and confidence in the group’s profitability and growth prospects, and this may require comprehensive revisions to the prospectus
The risks to the Ant Group IPO’s success and its fundamental are largely regulatory, along with a worsening of geo-political tensions and any potential worsening of the Chinese macro-economic outlook


Ant Group: IPO Suspension and the Big Data Angle