Didi Chuxing, a Chinese ride-hailing service that entered the Kazakhstani market in May, is going to raise money through Initial Public Offering on the U.S. stock market, Interfax news agency reported.
Once the company gets through an IPO, its market value might be assessed at about $70 billion, according to The Wall Street Journal. As the startup has already announced, its depository shares will be available for purchase starting from July this year with ticker DiDi. However, the company didn’t decide yet what stock exchange it will choose for IPO.
All the money DiDi would raise in an IPO will be spent on investing into technologies and business expansion outside mainland China.
Didi Chuxing was established in 2012 by Cheng Wei, who used to work in Alibaba Group. Currently, he controls 7% of the company’s shares and 15.4% of voting shares. There are several big companies among DiDi investors, including the Japanese Softbank Group (21.5%), American Uber Technologies (12.8%) and Chinese Tencent (6.8%).
In 2020 due to the COVID-19 pandemic and some restrictions on the movement of people, the company’s revenue slid by 8.4% to $21.6 billion. Net loss reached $1.63 billion last year. Also, the company had fixed losses over the two previous years as well.
However, in the period from January to March this year, DiDi managed to get a net profit of $30 million.
DiDi service is available in 14 countries (PCR is excluded), including Japan, Australia, Mexico and Russia.
In May 2021 DiDi started its operations in two major cities in Kazakhstan: Nur-Sultan and Almaty.
The company believes that Kazakhstan has great potential in terms of ride-hailing. Over the period from 2014 to 2018 the frequency of ride-hailing in Kazakhstan rose by almost 50% to 618.7 million rides, according to BusinessStat. By 2023 this rate will reach 856 million rides.