Major Chinese rideshare app Didi Chuxing (DIDI) has had a stormy week following its initial public offering and listing on the New York Stock Exchange (NYSE) last week. Following the IPO, the app has come under the review of Chinese cybersecurity regulation, and no new users will be able to download the app in China until the review is complete. As a direct result, Didi’s stock value dropped over 20 percent coming into this week and looks to be in a tumultuous state for the immediate future.
This news came as the markets opened up on Tuesday and in lieu of various information over the weekend, as reported by CNBC. It was on Friday, July 2, that China reported the review of Didi, stating that new users of the rideshare giant app would not be able to download it until regulators had conducted a cybersecurity review. Further reporting at The Wall Street Journal on July 5 suggested that regulators had warned Didi to postpone its IPO weeks before it took place and landed on the New York Stock Exchange last week.
Didi has not formally commented on the matters surrounding its review or the alleged suggestion to postpone its IPO. However, its share value took a major hit as a direct result. The Stock took a near 25 percent dive after closing at $15.52 per share on Friday. Tuesday saw the stock open at a low of $11.58 per share. Though it has recovered slightly, it is still likely to remain in limbo as the Chinese cybersecurity review is in effect and keeping the app from new customers. This might be seen as especially alarming considering stock market-focused TV personality and CNBC Mad Money host Jim Cramer went all-in on suggesting buys of the DIDI stock fairly recently.
What comes afterwards will likely be directly affected by the results of investigation and regulation in China, but it will remain to be seen if Didi Chuxing recovers from the hefty drop it took over the weekend anytime soon. Stay tuned as we continue to follow this and other relevant stock news for further updates and information.