Chinese ride-hailing giant Didi Chuxing is delisting from the New York Stock Exchange (NYSE), citing a lack of liquidity in its American depositary shares (ADS). The company will continue to trade on the Hong Kong Stock Exchange (HKEX) where it was listed in December 2020.
Didi, which is often referred to as the “Uber of China,” went public in the United States in 2018, raising $1 billion in its initial public offering (IPO). However, the company’s shares have struggled to gain traction in the US, with the stock down more than 40% since its debut.
The company said in a statement that the decision to delist from the NYSE was made after a comprehensive review of its capital markets strategy, and was driven by a desire to focus on its primary listing in Hong Kong. The company added that it believes the HKEX will provide more liquidity and greater access to capital for its shareholders.
The delisting is the latest indication of a growing trend of Chinese companies pulling back from the US stock market. The US-China trade tensions and stricter regulatory scrutiny of Chinese companies have made it more difficult for Chinese firms to raise capital in the United States. Additionally, many Chinese companies have been choosing to list on domestic exchanges, where there is a larger pool of investors familiar with their business and willing to invest.
The delisting from NYSE also comes as the Biden Administration increases its scrutiny on Chinese companies listed in the US, the move to delist from NYSE can also be seen as a way to avoid this scrutiny.
Didi’s decision to delist from the NYSE is not surprising, as the company has been struggling to gain traction in the US market. The company’s shares have underperformed since its debut, and the company has been facing increased competition from Uber and other ride-hailing companies in China.
However, it is worth noting that Didi’s decision to delist from the NYSE does not mean that the company is struggling financially. On the contrary, the company has been performing well in its home market, and it is currently valued at over $70 billion. The company’s financials are strong, and it has been investing heavily in new technologies such as autonomous vehicles and electric vehicles.
In conclusion, Chinese ride-hailing giant Didi Chuxing has announced that it will delist from the New York Stock Exchange (NYSE) citing a lack of liquidity in its American depositary shares (ADS). The company will continue to trade on the Hong Kong Stock Exchange (HKEX) where it was listed in December 2020 and believes that this will provide more liquidity and greater access to capital for its shareholders. The decision to delist from the NYSE is part of a growing trend of Chinese companies pulling back from the US stock market due to trade tensions and stricter regulatory scrutiny. Despite the delisting, the company is financially stable and continues to invest in new technologies such as autonomous vehicles and electric vehicles. Didi’s decision to delist may also be seen as a way to avoid scrutiny from the current US administration. The company’s main focus will now be on its primary listing in Hong Kong and expanding its operations in Asia and other regions.
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