As of 10Jul23
DIDI like Uber, Grab, Gojek is in the private car hire business.
Why DIDi will survive?
• Current at only ~$3 it has a Market capital of $14.33B USD, with revenue of over 20Bn in 2022 (3) even with the fines of $1.2B USD in China (1) it has a very high likelihood to be able to repay their fines.
• It is still one of top 2 taxi app (Kuai Di & DIDI) previously being the top after 18 months banned from new registrations.
• The company has a name for being the one who ousted Uber out of China and made it's competitor a partner (4)
Why Multibagger?
• Listed IPO price of $14 and if not for the compliance issue it would have gone way beyond $14 opening at $16.65 (2)
• Once it get backs to normal business it will have a very high chance to recover to $10 and beyond.
• Consider Luckin coffee who committed financial fraud a criminal offence it could recover from it all time low of almost $1 to now at $27, considering that DIDI is a much stronger business.
• DIDI is very much still in the race even with it's very strong competitors and with its strong leadership team once relist can happen recover back to $10 is highly expected
• Hype and fear of losing, and the US and China relations are what is keeping DIDI so low, and it is once in a life time once it recovers from its scandal and back to it's realistic price it will be difficult to buy in any more.
Reference:
1
https://www.reuters.com/technology/china-fines-didi-global-12-bln-violating-data-security-laws-2022-07-21/
2
https://www.reuters.com/technology/didi-shares-set-open-over-14-higher-mega-us-ipo-2021-06-30/#:~:text=SoftBank-backed (9984.,than its $14 IPO price.
3
Seeking Alpha DIDIY Income statement 2022
4
https://www.theguardian.com/technology/2016/aug/01/uber-deal-didi-chuxing-china-analysis
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