(Bloomberg) — Didi Global Inc. shares fell in U.S. premarket trading after Chinese regulators were said to have asked the ride-hailing giant to delist from U.S. exchanges.
Didi’s American depositary shares traded at $7.66 of 6:54 a.m. in New York, down 5.6% from the previous close. Regulators have asked the company’s top management to remove the firm from the New York Stock Exchange on worries over security, according to people familiar with the matter.
“In our view, privatization is the more unlikely option and dual listing the business in Hong Kong makes more sense,” William Mileham, analyst at Mirabaud Securities, said in written comments.
Didi has struggled since its U.S. debut in July after Chinese regulators launched multiple investigations into the company amid a crackdown on tech firms. The stock last closed at $8.11, down 42% from its initial offering price of $14.
Other U.S.-listed China stocks also tumbled in premarket trading, with tech giants including Alibaba Group Holding Ltd., Baidu Inc. and JD.com Inc. all falling at least 2% as regulators in Beijing issued draft guidelines that tighten advertising restrictions. Meanwhile, Pinduoduo Inc. shares plunged 14% after it reported third-quarter revenue and monthly active users were lower than analysts had projected.
A combination of China’s sweeping regulatory clampdown over the last year, coupled with a resurgence of Covid-19 cases in the country and a series of lackluster earnings reports in recent days has helped to further sour sentiment among investors and analysts alike.
The Nasdaq Golden Dragon China Index — which tracks 98 firms listed in the U.S. that conduct a majority of their business in China — has plunged 30% this year, including about 48% since a record high in February.
(Updates to include details on other U.S.-listed China stocks, pricing throughout, chart.)
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