Didi stock: How it performed on its first full day of trading

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Yahoo Finance 01 July, 2021 - 11:28am 22 views

When is Didi IPO?

DiDi Global is an app-based ride-hailing services company. It will make its public debut on the NYSE on June 30 at a price of $14 a share. InvestopediaDiDi Global (DIDI) IPO: What You Need To Know

Is Didi stock a good buy?

In a research note, Xiao said Didi has a secure position, dominating the Chinese ride-sharing market, with a share of more than 80%, multiple years of growth, and “best-in-class margins.” The continuing recovery from the Covid-19 pandemic should benefit the company in the near term, she said. Barron'sBuy Didi Global Stock, Analyst Says. It Began Trading Today.

Didi, the biggest ride-hailing company in China, raised about $4.4 billion in its U.S. initial public offering on Tuesday and sold more shares than it originally planned. Didi’s stock closed up 1% at $14.14 on Wednesday, giving the company a market value of about $68 billion.

That makes Uber’s current 12% stake worth about $8.1 billion. Didi’s public offering is the second largest U.S. listing by a Chinese company, behind Alibaba Group Holding Ltd.’s $25 billion debut in 2014, according to data compiled by Bloomberg.

Founded in 2012 by Cheng Wei, Didi emerged as Uber’s biggest rival in China at a time the San Francisco-based company was vying to expand globally. In their battle for market share, Uber burned through billions of dollars before stopping its losses by selling Uber China to Didi, known as Didi Chuxing at the time. The deal left Uber with a 20% stake in its competitor. Uber has been selling some of its shares in Didi in the run-up to the IPO, reducing its holding from about 14% in the first quarter.

Though Didi is dominant in China, momentum in the region is beginning to slow. The company plans to use the IPO funds to invest in technology, increase its presence in some international markets and introduce new products, according to its U.S. filings.

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Shares of Chinese ride-hailing giant Didi Global began trading on the New York Stock Exchange, kicking off what is set to be a busy summer of initial public offerings on the U.S. exchanges.

From working at a foot massage company to setting up China's biggest ride-hailing firm, Will Wei Cheng has navigated several hurdles on the path to taking Didi Global Inc public in a $4.4-billion New York float. As Cheng rose to the upper echelons of Chinese technology entrepreneurs, he faced challenges including tough competition, intense criticism for Didi after rape and murder cases linked to its drivers in 2018, and a COVID-19 induced slowdown at home. While the biggest share sale by a Chinese company in the United States in seven years, which values Didi at $67.5 billion, is a big win for Cheng and co-founder Jean Qing Liu, experts say the challenges are unlikely to go away soon.

Hundreds of Chinese companies trade in the U.S., but which China stocks should you consider? Here are the best Chinese stocks to buy and watch.

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The company priced 29.4 million shares at $17 each, below the $21 to $24 per share range it had set earlier. The IPO valued it at $2.7 billion. Krispy Kreme will start trading during one of the busiest weeks of 2021 for U.S. IPOs, with at least 17 companies scheduled to enter the market.

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There's a Reason... that Boeing has been trading in a tightly defined trading range (basing pattern), with the exception of a mid-March spike, for three months. Boeing gave up more than 3% on Monday to close at $239.96. Or is Boeing the problem child of many portfolios with a focus on the industrials?

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Didi closes up 1% on first day of trading

CNBC 01 July, 2021 - 05:58pm

Shares of Didi Chuxing closed up a modest 1% Wednesday afternoon after spiking as much as 28.6% in the Chinese ride-hailing giant's market debut.

The company's stock began trading at $16.65 per share, up about 19% from the company's offering price of $14 per share, bringing its market cap to nearly $80 billion. It closed at $14.14 apiece, with a market cap of about $67.8 billion.

Didi was most recently valued at $62 billion following an August fundraising round, according to PitchBook data. The valuation as of Wednesday's first trade is more muted than the $100 billion that some had predicted. Still, it ranks among the largest U.S. IPOs over the past decade.

Didi closing in the green bucks the trend of rideshare giants closing below their first trade price. The company's American counterparts, Uber and Lyft, both closed below the initial trade in their 2019 debuts. Lyft began trading at $87.24 and closed the day at $78.29, while Uber opened at $42 apiece and dipped to $41.57.

Didi's listing on the New York Stock Exchange comes as demand for ride-hailing services shoots back up in tandem with falling Covid-19 cases and a roll out of vaccines. Uber and Lyft also have both said they'll be profitable on an adjusted basis by the end of this year, thanks to the recovery.

The offering also represents a financial win for Uber, which owns 12.8% of the shares in Didi after it acquired Uber's China business. SoftBank's Vision Fund holds 21.5%. Apple also invested $1 billion in Didi in 2016.

Didi reported a comprehensive loss of $2.54 billion on $21.63 billion in revenue last year, but turned a slight profit of $95 million on revenue of $6.44 billion in the first quarter of 2021. (Some of the company's profitability in Q1 can be credited to gains on investments of $1.9 billion related to spin-offs and divestments.)

In comparison, Uber lost $6.77 billion on $11.14 billion in revenue last year, and lost $108 million on revenues of $2.90 billion in the first quarter of 2021.

Between 2019 and 2020, Didi's revenue shrunk almost 10% as the Covid pandemic struck China hard last year. However, prior to the pandemic, revenue grew 11% between 2018 and 2019. Additionally, revenue has bounced back in the first quarter as the pandemic recovery is in full swing, with 107% growth in Q1 from the previous year's quarter.

Didi, which was founded in 2012, said in its IPO prospectus that it has 493 million annual active riders, and 41 million average daily transactions. It began expanding internationally in 2018, and the company now operates in 14 countries outside of China, with Brazil and Mexico being the largest contributors, according to a Loop research note from earlier this month. Part of the proceeds raised from the IPO will also go to growing its presence in international markets.

In addition to traditional ride-hailing, Didi is heavily invested in making autonomous taxis a reality. The company recently got approval to test self-driving vehicles in Beijing.

Didi is also facing an antitrust probe into some of the largest Chinese companies. China's market regulator, the State Administration for Market Regulation, is investigating whether Didi used any competitive practices that unfairly pushed out smaller competitors, Reuters reported. It's also reportedly looking into the company's pricing mechanism.

Didi had warned in its IPO prospectus that it met with regulators earlier this year. The ride-hailing company warned they might be subject to penalties, as regulatory bodies might not be satisfied with the inspection results.

"We cannot assure you that the regulatory authorities will be satisfied with our self-inspection results or that we will not be subject to any penalty with respect to any violations of anti-monopoly, anti-unfair competition, pricing, advertisement, privacy protection, food safety, product quality, tax and other related laws and regulations. We expect that these areas will receive greater and continued attention and scrutiny from regulators and the general public going forward," the company said in its prospectus.

Didi was joined by a slew of other companies going public Wednesday, including biometrics screening company CLEAR, digital ad firm Taboola and cybersecurity company SentinelOne.

Didi, a four-time CNBC Disruptor 50 company, ranked No. 5 on this year's list.

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China's Didi to be added to FTSE's equity indexes on July 8

Reuters 01 July, 2021 - 05:58pm

By

Didi shares will be included in the FTSE All-World Index, the FTSE Global Large Cap Index, and the FTSE Emerging Index, FTSE Russell said in a statement on its website.

The announcement came as Didi, backed by Japan’s SoftBank Group Corp, rose slightly on its U.S. debut, valuing it at $68.49 billion, in the biggest U.S. listing by a Chinese company since 2014.

Didi is also backed by technology companies Alibaba, Tencent and Uber.

Reporting by Samuel Shen and Andrew Galbraith; Editing by Muralikumar Anantharaman

Our Standards: The Thomson Reuters Trust Principles.

Didi, the Chinese Ride-Hailing Giant, Makes Its Debut on Wall Street

The New York Times 30 June, 2021 - 11:58am

The company is going public as investors continue to embrace share sales by tech companies. But Didi could face additional scrutiny because of its Chinese origins.

Didi, the leading Chinese ride-hailing platform, made its Wall Street debut on Wednesday, capping a year in which ride-hailing and travel companies have struggled to overcome intermittent pandemic lockdowns.

Didi began trading at $16.82 a share on the New York Stock Exchange, up 20 percent from a $14-a-share offering price. But investor interest cooled throughout the day, and Didi closed at $14.20, pegging the company’s value at more than $69 billion.

The company made its debut, trading under the ticker DIDI, as Wall Street continues to embrace fast-growing tech companies regardless of their ability to turn a profit. Ride-hailing companies like Uber and Lyft, in particular, have proved to be profligate money losers, often burning through billions in cash each year.

Didi is no exception. It lost $1.6 billion last year, though it reported a profit of $30 million in the first quarter of this year. Revenues declined 8 percent to $21.63 billion last year because of the pandemic, the company said in a regulatory filing.

Despite its dominance in China and other countries, Didi could face unusual scrutiny from investors because of continued tensions between the United States and China. The American government has placed some Chinese tech companies on lists that restrict their ability to do business with the United States or its trade partners.

“Didi, for good and bad, is in the center of the U.S.-China cold tech war,” said Daniel Ives, managing director of equity research at Wedbush Securities. “It’s a successful I.P.O. coming out of the gates,” he said, but it still has a lot to prove to investors worried about tension between the countries.

Investors could also be wary of regulators in Didi’s home country. China’s antitrust authorities have begun to aggressively scrutinize the country’s big internet companies. Last year, Chinese regulators began cracking down on what they called unfair and anticompetitive business practices in the internet industry.

“China’s regulators already have them in their cross hairs,” said David Trainer, the chief executive of New Constructs, an investment research firm.

A taxi industry group wrote the country’s antitrust watchdog in December, urging the agency to take a second look at Didi’s purchase of Uber’s business in China in 2016. It had already investigated the sale on antitrust grounds without any action taken. The letter accused Didi of using unfair subsidies to retain passengers and of giving ride orders to unlicensed drivers and vehicles.

In April, Didi was one of nearly three dozen Chinese internet companies that were hauled before regulators and ordered to ensure their compliance with antimonopoly rules and to “put the nation’s interests first.”

Didi promptly issued a statement, which the antitrust regulator published on its website, vowing to “promote the development and prosperity of socialist culture and science” and to strictly obey the law. The regulatory pressure raised questions about whether Didi would be permitted to grow large enough to be consistently profitable, Mr. Trainer said.

Both Didi and Uber have made Latin America a focus for their global expansion. But the region continues to experience rising coronavirus caseloads, potentially throwing a wrench into growth plans.

“How are they going to do in places like Africa, the Middle East, or South America? Will you be hailing a Didi or an Uber?” said Drew Bernstein, the co-chairman of Marcum BP, an audit and advisory firm focused on Asia.

Didi Dache was founded in Beijing in 2012 and merged with a Chinese rival, Kuaidi Dache, in 2015 to form Didi Chuxing. In China, Didi’s ascent has mirrored that of other tech powerhouses including ByteDance, TikTok’s parent, and the food-delivery giant Meituan.

Although Uber tried to compete in the Chinese market, it eventually sold its Chinese operations to Didi in exchange for a stake in the company. Now that Didi is public, Uber’s stake is worth about $8 billion.

Two separate incidents in 2018 in which Didi drivers raped and killed female passengers spurred the company to make changes to its service but did not severely mar its appeal to users. Still, even as scores of companies both large and small have entered the ride-booking business in China, Didi has remained a leader.

Although Didi is dominant in China and operates in 16 other countries, including Australia, Brazil, Mexico and Russia, its valuation is notably smaller than Uber’s $94 billion. But unlike Uber in its trading debut two years ago, Didi was able to remain above its I.P.O. price during its first day of trading. Didi dwarfs Lyft, the second largest ride-hailing company in the United States, which is valued at nearly $20 billion.

Didi said that it had the ability to grow further as it expands its business to new international markets. “We aspire to become a truly global technology company,” Didi’s founders, Cheng Wei and Jean Liu, wrote in a letter included with its regulatory filing.

Didi was valued at $56 billion in 2017, and its investors include SoftBank of Japan; Mubadala, an Abu Dhabi state fund; Alibaba and Tencent, China’s two main internet Goliaths; and Apple, which invested $1 billion in 2016 to show its support for the Chinese market.

A number of Chinese businesses have sold shares on American exchanges in recent months, including ones in industries, such as electric vehicles, that have been snared in trade tensions between Washington and Beijing. The Chinese electric carmaker Nio raised $2.6 billion in a December offering on the New York Stock Exchange.

Before leaving office this year, President Donald J. Trump barred Americans from investing in companies identified as having links to China’s military. But his administration did not move forward with efforts to curb access to American capital markets for a wider range of Chinese companies.

Didi stock

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