Before the US IPO, Didi weighed in on a potential listing in Hong Kong but abandoned the attempt after the city’s exchange, which placed stricter requirements on companies seeking listings compared with peers in New York, doubt Didi comply with Chinese regulations. It does not have a license to operate in certain cities, and many of its drivers do not have a hukou, or hukou, for the cities in which they live, part of the city’s requirements for offers on-demand ride-hailing there, people with knowledge of the matter said in July. Even if Didi delists in Hong Kong, some investors may choose the opportunity to sell rather than swap their shares. Didi stock is down 63% from its post-IPO peak, wiping out about $50 billion in market value. Technically, swapping US stocks for shares in Hong Kong should be relatively straightforward for most institutional shareholders. But new securities can trade at a valuation discount: Hong Kong has long had the lowest price-to-earnings ratio in the world.
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