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A Highflying Chinese Financier Is Missing. Why It May be a Warning for Alibaba.

Investors have become more optimistic about the regulatory backdrop for Alibaba and its peers.

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Greg Baker/AFP via Getty Images

Shares in a Shanghai investment banking group collapsed on Friday, and the reason why may hold warnings for
and other Chinese tech stocks.

China Renaissance
(ticker: 1911.H.K.) stock fell as much as 50% in Hong Kong trading on Friday, finishing 28% lower, after the financial advisory firm disclosed that its chairman, CEO, and controlling shareholder was missing. 

The man in question is Bao Fan, a high-flying Chinese financier with strong ties to the country’s technology sector, having been involved in deal making related to ride-hailing group
DiDi Global
(DIDIY) and e-commerce platform

“The Company has been unable to contact Mr. Bao Fan,”
China Renaissance
said in a Hong Kong stock exchange filing on Thursday. “The Board is not aware of any information that indicates that Mr. Bao’s unavailability is or might be related to the business and/or operations of the Group which is continuing normally.”

This is not a good sign for China Renaissance, obviously. But it may also be a sign that the regulatory backdrop to China’s tech sector is less friendly than investors have been hoping for.

It is not completely out of the ordinary for Chinese business figures to go missing. 

Jack Ma,
‘s (ticker: BABA) founder, himself was unreachable for months on end after Beijing regulators quashed plans for his fintech Ant Group to go public, with speculation that the tech billionaire may be in detention or hiding from the law. Ma, for his part, has since resurfaced in Japan and Hong Kong in recent months, according to reports, but disappearances such as these aren’t unusual in the world of Chinese business.

What has happened to Bao? China Renaissance did not immediately respond to a request for comment from Barron’s on an update to its leader’s whereabouts.

Some Chinese tech stocks, like
have crept higher in recent months, helped by the reopening of China’s economy after a year of restrictive Covid-19 measures. But the biggest tailwind for the sector has been multiple signs from regulators that pressure on tech is easing after a crackdown that has lasted much of the past two years. 

Chinese tech has had a brutal stretch—with Alibaba losing almost half its market value in 2021—amid scrutiny from Beijing on one of the fastest-growing sectors of the world’s second-largest economy. Those pressures began in earnest with the scuttling of Ant Group’s IPO plans in late 2020 and Ma’s disappearance. While the picture has recently improved, Bao’s disappearance is unnerving.

Investors may be reading into the latest news on China Renaissance. The U.S.-listed shares in Chinese tech behemoth Alibaba fell 1.9% in U.S. premarket trading on Friday, with
(JD) stock also down 1.9%.
shares lost 2.8% in Hong Kong. This price action outstrips wider declines in the stock market on Friday, where futures tracking the
S&P 500
were 0.7% lower.

Write to Jack Denton at


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