Didi Global (NYSE:DIDI) stock plunged 6.3% to $11.58 in Friday’s premarket trading as officials from as many as seven government departments in China visited the ride-hailing company’s offices to carry out a cybersecurity review.
It has been a rough ride for China’s largest ride-hailing firm ever since it listed on the NYSE on June 30. Its shares have mostly traded below the issue price of $14.
The company has already warned of a hit to the revenue in view of the investigations in China that started at least two weeks ago.
Early July, the company was told to stop onboarding new users until a review was over. Playstores like Alipay and WeChat were asked to take Didi’s app and dozens more other apps designed by the company off their platforms.
A July 5 report in The Wall Street Journal had said that the Chinese regulators wanted the company to delay its listing on the New York Stock Exchange but the company ignored it in absence of a formal order.
Didi is among the several companies the Chinese are probing given that many of them are now listed in the U.S. The authorities there are concerned over the stash of data they hold and which they may be required to share with the U.S. regulators to comply with the listing norms.
Didi operates in more than 4,000 locations in 15 countries, though China mobility represents the bulk of the revenue.