DiDi Global Inc Stock News and Forecast: Is DIDI going to delist from the NY stock exchange?
- DIDI is rumoured to delist from the US stock market.
- Bloomberg reports China has asked DIDI to delist from NYSE.
- The reason for DIDI is due to concerns over data security.
DIDI stock had been hammered earlier this year as concerns over increased Chinese regulation on tech stocks led a host of Chinese tech names to move sharply lower. The origins of the move came in the cancelled spin-off IPO of ANT Group which was a subsidiary of Alibaba (BABA). China has growing concerns over the amounts of data that its tech sector creates and stores on Chinese citizens. DIDI only IPO'd in New York this year in what was a successful listing with the stock IPO'ing at $14 and traded up as high as $18.01 on the first day.
DIDI stock is currently trading at $7.53 in Friday's premarket for a loss of 7%.
DIDI stock news
Bloomberg reports that Chinese regulators asked DIDI senior executives to come up with a plan to delist from the New York Stock Exchange (NYSE). Reuters picked up the report and asked Didi or the Cyberspace Administration of China (CAC) for comment but neither have as of yet replied. According to Bloomberg two proposals involve a straight privatisation or a move to listing in Hong Kong. The report also adds that shareholders are likely to be offered the IPO price of $14 as a lower price could lead to litigation. At the time of the IPO SoftBank was listed as owning 21.5%, Uber (UBER) owned a 12.8% stake and Tencent (TCEHY) owns just under 7%.
DIDI stock forecast
The intraday chart below (30 minutes) shows that DIDI has struggled to break below $8 on a number of occasions but this move in the premarket may get the job done. There is pretty decent volume-based support around there so holding under it will be key.
The daily chart shows the support at $8 and the large volume. $8.11 is the point of control since the IPO. That is the price with the highest amount of volume. Below $8 is support at $7.16 from the lows back in July and August. This will be the key test for the move in Friday's premarket. It will be interesting to see if some merger arb hedge funds play this game. This is not a normal special situation deal for them with no identified take out price but if rumours of the listing being taken off at $14 are corerct then at some point merger arb funds will be all over this one. Keep an eye on volume and large block trades, these would be a sign of possible hedge fund activity.
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Author
Ivan Brian
FXStreet
Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.
