Power Of Capital: Didi Is Still On The Way

For Didi, which was founded in July 2012, Deng min (alias) is not an early user.

"The first time I used didi was on December 21, 2015. From Beijing Yingtai business center to Beijing Foreign Studies University, I took the Honda vanguard, nearly 10 kilometers." Deng min reported her order to the 21st century economic reporter, "due to the use of coupons, this order is 7 yuan in total."

Deng min still remembers the palpitation when she paid the bill after the first ride. "It's a little unbelievable that my heart is pounding.". Her feeling is not exaggerated: 7 yuan, only half of the starting taxi price (13 yuan) in Beijing. If we charge according to the normal taxi standard, the trip will cost about 30 yuan.

However, Deng min did not catch up with didi subsidies at its most crazy time. In 2013, didi and Kuai were in the middle of a "beach battle" and announced that they had received huge capital injection from Tencent and Alibaba respectively. In January 2014, with Tencent's $100 million financing in place, Didi taxi began to issue red packets, and Kuai Dai followed closely with Ali's support. The red envelope war between the two sides once reached a state of madness. In the first half of 2014 alone, the subsidy exceeded 2.4 billion yuan.

"At that time, I could see the sharing links of didi coupons in the circle of friends and wechat groups every day. Because my friends were too busy, I was a bit rebellious, so I didn't download Didi's app for a long time." "It's a little regretful to think about it now," Deng recalled

This round of subsidy war came to an end with didi and Kuai merging on February 14, 2015. The next year, Didi made another journey and "swallowed" Uber China. Since then, Didi had the "youth spirit" when he quickly attacked the city and occupied the territory, and was pushed to the forefront of public opinion because of the user security incident; There are low tide period and self reflection, but also after reflection, they have learned from the bitter experience and put all their efforts into the improvement of safety ability.

Until the early morning of June 11, Beijing time, Didi formally submitted its IPO prospectus to the SEC, with the stock code of "didi". Goldman Sachs, Morgan Stanley, JPMorgan Chase and Huaxing capital acted as underwriters. This also means that, nine years after its establishment, Didi, after its cocoon breaking and transformation, has finally begun to have the courage to give an answer to the outside world and himself.

China's travel business accounts for the absolute majority of Didi's overall income- Figure IC Photo

Rush for IPO

Didi's prospectus is rich in information.

According to the prospectus, from 2018 to 2020, the annual income of didi travel was 135.288 billion yuan, 154.786 billion yuan and 141.736 billion yuan, respectively. In the first quarter of 2021, Didi's travel income was 42.163 billion yuan. Due to the impact of the epidemic, the income growth of didi has fluctuated in the past three years.

In terms of profits, Didi travel continued to lose money in the past three years. The data shows that in 2018, 2019 and 2020, Didi's net losses were 14.979 billion yuan, 9.733 billion yuan and 10.608 billion yuan respectively, and the adjusted net losses before interest and tax were 15.492 billion yuan, 10.081 billion yuan and 10.911 billion yuan respectively.

In the first quarter of this year, Didi made a profit of 5.404 billion yuan, compared with a loss of 3.972 billion yuan in the same period last year; The adjusted net profit before interest and tax was 5.404 billion yuan, with a loss of 4.151 billion yuan in the same period last year.

However, Didi travel is still operating at a loss. According to the prospectus, Didi had operating losses of 12.443 billion yuan, 8.013 billion yuan and 13.788 billion yuan in 2018, 2019 and 2020, and 6.654 billion yuan in the first quarter of this year.

Data show that the key to turning losses of didi in this quarter is to obtain 12.36 billion yuan of net investment profit, including the disposal of 3.3 billion yuan of equity investment, and the 9.1 billion yuan of unrealized income included after the separation of orange heart.

According to the analysis made by senior securities dealers to the 21st century economic reporter, the growth of Didi's income and the expansion of operating losses constitute the risk points in this prospectus. However, although it is still in the front line between profit and loss, several analysts are optimistic about Didi's future development space.

"Didi has quite a leading position in the market. Its products have strong penetration, and users are also dependent and use frequently. I think it is no problem for this company to make profits in financial reports." Zhang Yi, CEO of AI media consulting, pointed out to the 21st century economic reporter that Didi's losses are strategic losses to a certain extent. The reason for the strategic losses lies in the deep cultivation of the industry, subsidies for drivers and users, as well as expansion investment in emerging markets and subdivided fields. These are also the main loss points of Didi.

In Zhang Yi's view, one of Didi's future growth space is reflected in its international business. At present, Didi's business is divided into three parts: China travel business, international business and other businesses. Among them, China's travel business includes car hailing, taxis, Valet driving and downwind vehicles, international business includes international travel and takeaway, and other businesses include bike sharing and motorcycle sharing, car service, freight transportation, automatic driving and financial services.

China's travel business accounts for the absolute majority of Didi's overall income. From 2018 to 2020, Didi's travel business income accounted for 98%, 96% and 94% of the total revenue respectively“ Didi has achieved great success in China. I think he has certain opportunities for expansion and growth overseas. " Zhang Yi pointed out.

At the same time, Zhang Yi believes that Didi's growth space is not only confined to travel, "travel can be used as an entry point to attract users（ First of all, we can expand the travel from four wheels to two wheels, freight transportation and other businesses, all of which have opportunities. In addition, on the basis of considerable users, Didi can also expand its business to new businesses, such as new retail and local life, which can be planned as the future growth of Didi. "

Multi index surpassing Uber

It should be noted that Didi's prospectus is not inferior to that of Uber, a global travel giant.

According to the prospectus, in the 12 months ending March 31, 2021, Didi had 493 million active users and 15 million active drivers worldwide annually. Among them, from March 31, 2020 to March 31, 2021, Didi has 377 million active users and 13 million active drivers in China.

In the first quarter of 2021, Didi China Travel had 156 million monthly live users, compared with 98 million monthly live users of Uber in the first quarter of this year. This means that Didi's monthly work in the first quarter of this year is about 1.6 times that of Uber.

Active users directly determine the order quantity. Therefore, Didi has surpassed Uber in terms of order quantity. In the 12 months ending March 31, 2021, Didi's global average daily transaction volume was 41 million. In the first quarter of 2021, the daily average transaction volume of Didi's China travel business was 25 million, totaling about 2.25 billion. In the same period, Uber's total travel orders were 1.447 billion.

In terms of income, Didi also surpassed Uber for a long time. According to the 21st century economic report, Uber's revenue from 2018 to 2020 is US $10.433 billion, US $13.00 billion and US $11.139 billion respectively, and that of Q1 in 2021 is US $2.9 billion, which has been hovering around half of Didi's revenue over the years.

"It's not surprising that Didi's data surpasses Uber. China's market is very large, with a large population, and the demand for Didi's services is quite demanding, "Zhang Yi told the 21st century economic report." judging from the prospectus, Didi's business has been showing a good momentum in recent years, which is also a good industry data. In the future, Didi has great opportunities and growth space in promoting and penetrating the whole market. "

In the process of benchmarking with Uber, the reasonable range of Didi's valuation also began to appear. Prior to that, Didi's plans to list on the market for many times, with valuations hovering between $60 billion and $100 billion. At present, the latest market valuation of didi is more than $70 billion. By comparison, Uber's latest market value is $92.75 billion.

"If we use 4 times the market value / sales ratio, it is reasonable to give didi a valuation of $100 billion." The above-mentioned high-level securities dealers to the 21st century economic reporter analysis said.

Didi, whether on the market or not, has been running on the road.

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