China's Didi reports net loss of $1.6bn for 2020 as it prepares for listing

The SoftBank-backed company plans to go public in one of the largest initial public offerings of the year.

Didi registered its regulatory filing under its formal name of Xiaoju Kuaizhi, with Goldman Sachs Group, Morgan Stanley and JP Morgan Chase backing the offering. Bloomberg

Chinese ride-hailing company Didi Chuxing has reported a 2020 net loss of $1.6 billion on revenue of $21.6bn as it prepares to go public in one of the largest technology listings of the year.

Revenue in the first quarter of this year stood at $6.4bn while net income was $837 million.

Didi revealed plans to offer shares worth $100m in its first public filing but the figure is subject to change after it discloses terms for the sale of shares.

The Chinese company registered its regulatory filing under its formal name of Xiaoju Kuaizhi, with Goldman Sachs Group, Morgan Stanley and J P Morgan Chase backing the offering.

Didi, the largest investment within SoftBank Group’s portfolio, sought a valuation higher than $62 billion, which it secured during its previous funding round. Uber owns 12.8 per cent of the Chinese company while SoftBank has a 21.5 per cent stake.

Founded by former Alibaba Group executive Cheng Wei in 2012, Didi competed with Uber in China for years until it bought the American company's operations in the country in 2016. It has since then held a near-total monopoly on the market but has suffered a series of setbacks to its business and reputation.

The company's planned listing comes as the ride-hailing market recovers as movement restrictions that were imposed to curb the spread of the Covid-19 pandemic are lifted in many markets.

However, it has cited risks such as a failure to ensure the safety of the passengers and rising competition within the ride-sharing segment as factors that could affect its business in the future.

Chinese businesses have been listing on US stock exchanges at a record pace.

Companies from the mainland and Hong Kong have raised $6.6bn through initial public offerings in the US this year, a record start to a year and an eight-fold increase from a year ago, according to data compiled by Bloomberg.