Shares of Chinese technology firm Didi Global (NYSE:DIDI) plunged in premarket trading after a Chinese regulator ordered the removal of the company’s platform from app stores.
The stock price of Didi Global fell as much as 30% to $10.90 U.S., wiping out about $22 billion U.S. of market value and taking the stock below its $14 U.S. IPO price just days after the company’s $4.4 billion U.S. market debut.
The Cyberspace Administration of China barred new users from Didi’s app, citing security risks and tightening its grip on sensitive online data. Beijing is in the process of a wider crackdown on the nation’s technology firms designed to curb their growing influence.
Didi, whose American Depository Receipts have only traded in New York since June 30, said the move may have an "adverse impact" on its revenue in China.
While its half-billion existing users will still be able to order rides for now, China’s cybersecurity crackdown adds to the uncertainty surrounding all of the nation’s internet companies.
Tencent Holdings, which has a stake in Didi, is down 2.7% so far this week. The onslaught of Chinese government crackdowns began on July 2 after markets in Asia closed.
The number of companies based in China filing for New York-based IPOs has climbed for a third straight quarter despite weakness in other U.S. listed stocks that conduct most of their business in China.
The NASDAQ Golden Dragon China Index is down about 8% for the year, lagging behind the 14% gain in the NASDAQ Composite Index.
