News of the long anticipated filing for its stock market listing in the United States was made public by the biggest ride-hailing firm of China, Didi Chuxing. That now sets the stage for what is expected to be the largest initial public offering of the world so far this year.

The size of the IPO was not revealed by the company which has the backing and support of Asia’s largest technology investment firms, SoftBank, Alibaba and Tencent. However reports quoting sources had previously said that the company could aim to raise about $10 billion while it wants to achieve a valuation of close to $100 billion.

If that valuation is accorded to the company, the listing of Didi would be the largest share offering by a Chinese firm in the United States since the 2014 listing of Alibaba of $25 billion.

The impact of the Covid-19 pandemic had resulted in slower revenue growth for the company in 2020 shows its regulatory filing on Thursday. With human movement severely constrained because of the pandemic, ride hailing companies all over the world, including Uber and Lyft, were severely hit. 

The company had generated revenue for 141.7 billion yuan ($22.17 billion) in 2020 which was lower than the 154.8 billion yuan that was generated by it a year earlier. The net loss of the company was at 10.6 billion yuan, compared to 9.7 billion yuan loss a year earlier.

2021 however saw a strong beginning for Didi with businesses reopening in China. For the three months ended March 31, the revenue of the company more than doubled to 42.2 billion yuan compared to 20.5 billion yuan in the same period a year ago.

According to reports, Didi had filed for its IPO in April confidentially and is targeting to launch the public listing in July this year. The mega IPO highlights the lucrative business opportunity presented by Asian tech giants for Wall Street’s big investment banks.

A $40 billion deal with a special purpose acquisition company to go public in the United States was struck by Singapore’s biggest ride-hailing firm, Grab, earlier this year.

According to Refinitiv data, Chinese firms had raised a total of $12 billion last year from their listing s in the United States which was more than triple of the money raised in 2019. Analysts expect the number this year to comfortably go past last year’s number.

A mobile app, where users can hail taxis, privately owned cars, car-pool options and even buses in some cities is the core business of Didi which had merged with the then main rival Kuaidi in 2015 and created a smartphone based transport services giant.

The company said that it plans to list American Depositary Shares (ADSs) on either Nasdaq or the New York Stock Exchange under the symbol “DIDI”.

Didi aims to have 800 million monthly active users globally and to complete 100 million orders a day by 2022 which includes ride-sharing, bike and food delivery orders, said the company’s Chief Executive Cheng Wei last year.

Goldman Sachs, Morgan Stanley and J.P.Morgan are the lead underwriters for the offering.

(Adapted from CGTN.com)