A rough month for Chinese stocks is getting even rougher. Chinese rideshare app DiDi has announced its plan to delist from the New York Stock Exchange.
That’s probably not surprising to those of you who have been reading our coverage of the company. DiDi’s IPO got off to an explosive start, valuing the company at $70 billion. But that didn’t last — the ‘Uber of China’ quickly became a focal point in China’s latest policy drama. A cybersecurity inquiry into the company sent shares tumbling in July, which inspired a broader market “reset” in Chinese stocks.
DiDi’s troubles were soon the troubles of all U.S-listed Chinese companies — Alibaba, Tencent, Pinduoduo, and many more suffered from the new policy positions of the Chinese Communist Party. The government assailed media, video games, education companies, and companies which might be in the situation of “owing something” to foreign nations (read: the U.S).
China’s positions are unlikely to change after DiDi completes its voluntary de-listing. In fact, it’s probable that the company’s de-listing might encourage other U.S-listed Chinese companies to do the same. DiDi is expected to re-list itself on Hong Kong Stock Exchange — it’s been suggested that DiDi will allow investors to swap their NYSE shares for the new Hong Kong ones when it goes public overseas.
$DIDI is down 22.8% this trading week. The stock is down 60.9% since listing.