Can DiDi's IPO debacle end on with its exit from US markets? - Kalkine Media

November 26, 2021 10:28 AM EST | By Raza Naqvi
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Highlights

  • DiDI is a Chinese transport company and its stock started declining two days after its debut on the New York Stock Exchange (NYSE).
  • Fresh reports are claiming that DiDi could soon exit the stock market as Chinese regulatory authorities have reportedly asked the transport company to do so.
  • DiDi's ride-hailing application was banned from the mobile application stores in China, and it failed to attract investors.

Ever since its debut in the US equities market, DiDi Global Inc (NYSE:DIDI) stock never really got a chance to take off and its problems began when the Cyberspace Administration of China started a review of its data practices.

DiDI is a Chinese transport company and its stock started declining two days after its debut on the New York Stock Exchange (NYSE). After the review was launched by the officials, DiDi's ride-hailing application was banned from the mobile application stores in China, and it failed to attract investors.

Now, fresh reports are claiming that DiDi could soon exit the stock market as Chinese regulatory authorities have reportedly asked the transport company to do so. According to reports, Chinese regulators have asked DiDi's management to start planning for getting delisted from the NYSE.

Also Read: DiDi stock dives 5% after China regulators open cybersecurity probe

Why DiDi could exit from NYSE?


The Chinese transport company could delist from the stock market as Chinese regulators have reportedly expressed concerns over the leakage of sensitive data. If the delisting happens, DiDi could either consider for privatization or a share float.

DiDi IPO debacle

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If the company opts for privatization, DiDi could offer a price of US$ 14 per share IPO price to the shareholders. The transport company will most likely not offer a lower price per share as it could prompt lawsuits or face resistance from the shareholders.

Big technology giants are under scrutiny from Chinese authorities over alleged monopolistic behaviour and improper handling of consumer data.

Bottom line


Investors are responding negatively to the latest reports claiming that DiDi will get delisted and at the start of the trading session on Friday, November 26, the stock declined 5.4 per cent.

Since June 30, when the DIDI stock had achieved an all-time high of US$ 18 per share, it had declined by about 55 per cent as of November 25.

Also Read: 2 Canadian tech stocks to buy under $15


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