Meow17
2021-07-16

$DiDi Global Inc.(DIDI)$

@simplydkam@Zenekz@IZLIN@Sagi08

It has been a tough few weeks for DiDi Global (NYSE:DIDI). Mere days after its market debut, the ride-hailing company's shares closed on July 9 at $12.03, down more than 14% from the IPO price.

On June 30, DiDi raised $4.4 billion via an initial public offering that valued the company at more than $70 billion, selling 317 million American Depositary Shares (ADS) at $14 a pop -- the top of the range marketed to investors. In the process, DiDi became the biggest Chinese company since Alibaba to list in the U.S.

But shares of DiDi are now underwater, due in large part to a regulatory clampdown by Beijing on U.S.-listed Chinese stocks. DiDi's mobile app has been pulled from app stores in China, so for now, no new customers can sign up for the service. While investors are understandably feeling cautious about DiDi right now, others may be wondering if this pullback represents a buying opportunity.

It's not hard to understand why these big names bet big on DiDi. Almost 25 million people use it to get around China every day, using a range of shared mobility services that include standard ride-sharing, luxury limos, and e-bikes. It is by far the largest ride-hailing company in China with a user base of 377 million annual active customers and 13 million active drivers.

DiDi had a challenging 2020, but its long-term prospects look as exciting as ever. Management estimates the global mobility industry -- a market that includes ride-hailing, public transport, and e-bikes -- was worth $6.7 trillion in 2020. It predicts the value of this market will more than double by 2040, driven by urbanization and globalization trends. As a subset of this market, the penetration of shared mobility is expected to grow from 2% in 2020 to 24% in 2040. DiDi believes shared mobility will make transport more affordable and convenient over time, partly due to the advent of self-driving cars.

 And as more customers start using DiDi, more drivers will naturally gravitate toward the platform, fueling a virtuous cycle of more users and more drivers. As long as it keeps both sides happy, it will likely be able to ride the mobility market's growth for years.

Still, DiDi faces a winding and rocky road ahead. For one thing, it's still unprofitable. This might remain the case as it pours cash into advertising and incentives to attract and retain drivers and customers.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • smallcatcat
    2021-10-30
    smallcatcat
    Didi not much competitor domestically. hopefully can move forward after party convention. tech company in China been hackled by fear in government policy and regulation changes
  • kom
    2021-12-23
    kom
    //@kom: Great ariticle, would you like to share it?
  • pitben
    2021-10-20
    pitben
    Wait and see further before putting $ into this stock
  • Venkybenning
    2021-08-28
    Venkybenning
    Give me 1 like. Thk u
  • kom
    2021-12-23
    kom
    Great ariticle, would you like to share it?
  • 30498278
    2021-12-14
    30498278
    good read
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