He deals good damage but it's not too high. Don't forget he is a rare ninja just because he is in survival for now. Most rares have two chases, he has one that deals high damage if the target is affected by ignite. There is no point nerfing his damage when most of the other rare ninja do just as much if not more.
GNW Kankuro is not even considered rare and while deals the average amount of chase damage but his normal attack (with a puppet) deals really high damage, hits two targets that also suffer burn AND it has a 100% chance to hit + high float. Then you have his mystery that deals good damage ignite and poison on the whole enemy team. The only reason we don't see more of him is because he is only 2* and that let's fire mains one shot his puppet.