Didi turning to Hong Kong for mega IPO

China's top ride-hailing firm Didi Chuxing is considering Hong Kong for a multibillion-dollar initial public offering next year, rethinking previous aims to list in New York amid rising Sino-US tensions.

Didi, backed by technology investment giants SoftBank, Alibaba (9988) and Tencent (0700), has started initial talks with investment banks for the long-awaited IPO, according to three sources.

The Beijing-based company is targeting a valuation of more than US$60 billion (HK$468 billion) by the time of launching the IPO, expected in the first half of 2021, they said.

Founded eight years ago, Didi has begun generating healthy profit since the second quarter of the year and some of its investors are now keen to cash in, said one of the people.

All three said Didi has now opted to consider Hong Kong for the listing amid deteriorating US-China relations that have left tech firms like TikTok owner ByteDance in the crosshairs. The new timetable for the IPO and the private fundraising round ahead of the planned IPO have not been reported before.

However, Didi commented in an email to CGTN that "Didi does not have any definite IPO plan and we don't comment on market speculations."

Meanwhile, Ant Group won approval from the Hong Kong Stock Exchange for the offshore leg of its IPO, clearing the last key regulatory hurdle to launch a dual-listing expected to be worth about US$35 billion.

Ant plans to start a brief pre-marketing period this week before opening order books next week, one of the sources said. Its shares are likely to start trading "a few days" after the November 3 US presidential election. Ant initially planned for an IPO from next Tuesday to next Friday, and a simultaneous A+H share debut on November 6.

After receiving initial feedback from potential investors, Ant is looking to increase its offering size to US$35 billion from up to US$30 billion, targeting a valuation of about US$250 billion or more.

In other IPO news, KWG Living said it had received HK$5.68 billion in margin financing on the second day of subscriptions, less than HK$7.81 billion reported on the first day, meaning that some investors had backed out.

Also, Simcere Pharmaceutical planned to price its IPO at HK$13.7, the upper limit and Chinese data center operator GDS passed the listing hearing for a secondary listing in Hong Kong.