Didi Chuxing, China’s largest car-sharing company, is pushing for a NASDAQ IPO with the goal of receiving corporate value of up to $67 billion. As a result, Didi Chuxing is expected to be the largest IPO in the U.S. stock market this year.
According to SCMP, Didi Chuxing is conducting an IPO with the goal of evaluating corporate value of $62 billion to $67 billion in recent public data.
Didi Chuxing also said it plans to sell 288 million shares at the IPO after setting a public offering price of $13-14. It expects to raise about $3.9 billion. The company said it will invest its funds in developing new technologies and expanding its business outside of China.
At a time when Chinese businesses account for an overwhelming portion of total sales, it is believed that they expressed their willingness to speed up overseas expansion for sustainable growth.
After Uber withdrew its business from China in 2016 by selling its Chinese business to Didi Chuxing, it gained an exclusive position in China’s car sharing market.
However, the corporate value of 67 billion dollars targeted by Didi Chuxing is less than the 100 billion dollars expected by Bloomberg News in April.
Amid mounting inflation concerns, uncertainty in the financial market has led investors to focus on value stocks that can guarantee stable returns rather than high-risk growth stocks, which has also affected the IPO market. Analysts say that the lower-than-expected outlook for corporate value of Didi Chuxing, a car-sharing company classified as a leading growth stock, reflected this situation.
In addition, the fact that pressure from Chinese regulators is in full swing is one of the risks to Didi Chuxing.
The Chinese government is currently conducting an anti-trust investigation into whether the company has engaged in unfair competition to other competitors, along with the opacity of Didi Chuxing’s price policy.
According to a major foreign media source, the company understands that the price policy issue of Didi Chuxing, which is under investigation by the government authorities, is a minor issue and is unlikely to disrupt its IPO plan.