Chinese Internet ADR Sell-Off Is ‘Overdone,’ Citigroup Says

Slump in response to Didi plan to exit U.S. market could be a buying opportunity for shares with dual listings in Hong Kong, analyst argues

(Bloomberg) — Chinese ride-hailing giant Didi Global Inc.’s delisting plan is “an isolated case” for now and there is nothing new in the latest disclosure requirements from U.S. regulators that may cause more Chinese companies to leave soon, according to Citigroup Inc.

Concerns about immediate delistings of Chinese companies’ American depositary receipts (ADRs) are “overdone,” analyst Alicia Yap wrote in a note. “The risk of other ADRs delisting could materialize by 2025,” she said. Such a development would come after three consecutive years of failing to disclose mandated information starting with 2022 annual reports, Yap said.