After making a lightning-fast pitch to potential investors, Chinese ride-hailing goliath Didi Global Inc. is set to price its IPO Tuesday and begin trading Wednesday, the latest test for a scorching-hot market for initial public offerings.
Didi is expected to price its initial public offering Tuesday around $14 a share, people familiar with the matter said, which is at the high end of the company’s projected range. Didi’s pricing comes just three business days after it launched its roadshow, making it one of the shortest investor pitches for an IPO in recent memory, according to bankers, investors and lawyers.
Didi has been running its roadshow through round-the-clock virtual meetings because of time-zone differences, according to people who have participated. Company executives have focused on Didi’s scale and potential for continuing growth, the people said. The executives have emphasized that 70% of China’s population will live in cities by 2030 and that few people own cars in those cities—and far fewer than in the U.S. Didi argues it is in position to capitalize on that, from shared mobility in general to its investments in electric vehicles and artificial intelligence.
How the IPO prices and trades hinges partly on the company convincing investors to focus on Didi’s potential growth and brush aside the possible political risks around putting money into U.S.-listed Chinese companies. It will be entering a U.S. IPO market that has been white hot on the whole, but less hospitable for newly listed Chinese companies lately.
To help ensure the deal gets done, and one of the reasons the company was able to speed through its roadshow, Didi lined up roughly one-third of its IPO allocation in advance. Morgan Stanley Investment Management and Temasek Holdings Ltd. are so-called anchor investors that plan to buy $1.25 billion of shares in the IPO.
