Didi delists, survives with broken arms

Friends who are familiar with Chinese chess may know that chess is divided into opening, middle and endgames. But what is different from everyone's expectations is that people who are beginners in chess generally learn the bad chess first, then the opening game, and then the middle game.

The reason is also very simple. It is always relatively easy to clean up the mess and start the game well, and how to simplify the situation in the ever-changing middle game, or maintain the complex situation, is a crucial step to win the game.

Didi, which is about to be delisted, is in a chess game.

On April 16, Didi Chuxing issued an announcement announcing that it would hold a shareholders meeting on May 23 to vote on the delisting of the company's shares from the New York Stock Exchange. In order to better cooperate with the cybersecurity review and rectification measures, the company will no longer apply for listing on other stock exchanges until the delisting is completed.

Didi also stated that the company will continue to explore appropriate measures in the interests of the company and its shareholders, including exploring the possibility of listing on another internationally recognized exchange, subject to applicable rules, regulations, policies and guidance.

The China Securities Regulatory Commission commented on the matter for the first time. The person in charge said that the specific case of Didi's voluntary delisting has nothing to do with other US-listed Chinese concept stocks, and has nothing to do with the ongoing Sino-US audit and supervision cooperation negotiations. It will not affect the process of cooperation between the two parties.

So, does Didi, whose delisting is a foregone conclusion, really want to admit defeat?

Earnings report, mixed

Along with the news of the imminent delisting, Didi also released its financial reports for the fourth quarter of last year and the full year of 2021.

First of all, in Q4, Didi achieved revenue of 40.777 billion yuan in Q4, down 12.7% year-on-year; the single-quarter loss was only 170 million, and the dismal Q3 loss narrowed by nearly 99.4%, narrowed from 7.221 billion yuan in the same period last year 94.7%.

Taking the business apart, the revenue of China's travel business is still the mainstay of Didi. Although the amount of 37.47 billion yuan fell by 12.7% compared to the 46.7 billion yuan in the same period of the previous year, it only fell compared to the 42.675 billion yuan in Q3. 4%, which is considered to have stabilized in the precarious situation in the second half of the year.

The international business, which Didi has always valued, has grown dramatically, with revenue reaching 1.05 billion, a 51.2% increase compared to the same period last year; on the other hand, Didi’s revenue in other exploration businesses is also considerable, with a result of 2.26 billion It also increased by 22.2% compared to the same period last year.

Didi, which was still losing money crazily in the first half of the year, was able to generate revenue after the app was completely removed from the shelves?

The reason is that Didi got rid of its heaviest burden in Q4, Orange Heart Preferred. As a community group buying business unit that Didi once gave high hopes for, from the second half of 2021, Orange Heart Preferred began to shrink and lay off a lot of staff.

Daily Auto Telegraph learned that since August last year, several core business departments of Didi have been continuously recruiting and laying off the remaining Orange Heart preferred employees, and Didi also confirmed a net investment of 20.8 billion Orange Heart in Q3 last year. Losing money, Orange Heart Preferred was subsequently removed from the Didi Chuxing APP.

The failure of Orange Heart Optimization also led to a very interesting phenomenon in Didi’s 2021 annual financial report. The three main businesses have grown across the board. China’s travel business has increased by 20% year-on-year, international business has increased by 55.4% year-on-year, and other exploration businesses have increased by 68.1% year-on-year. . However, the net loss attributable to ordinary shareholders reached a staggering 50.031 billion yuan, nearly 4 times larger than the same period last year.

Today, Didi's troika structure has been very solid, with China's travel sector (domestic online car-hailing, taxi, chauffeur and ride-hailing services), international business sector (international travel and food delivery and other services) and other businesses ( The three-part business of shared bicycles and motorcycles, car clothing, freight, autonomous driving and financial services) is basically difficult to shake as the basic business of Didi.

After all, even in such a difficult situation last year, Didi’s market share in online car-hailing only dropped from 90% to 70%, and the average daily order volume dropped from 25 million to 20 million. Although it was a heavy blow to Didi itself, It is still difficult for other travel software to truly change Didi's dominance in the travel market.

Building a car, it's hard to tell if it's true or false

But can Didi, who has withdrawn from the market, really be able to sit back and relax? It doesn't seem to be.

Since the "Da Vinci" plan was revealed, Didi, which has always been low-key, has a posture of "I'm not pretending, I'm going to showdown", and news of various acquisitions and cooperation are flying around.

The first is Haima Automobile. In early April, according to foreign media reports, Didi is in talks with Haima Automobile to cooperate in the production of electric vehicles, and at the same time, Didi is also discussing potential partnerships with other automakers. Discussions are ongoing, however, and Didi has yet to make a final decision on the partnership.