Didi Shares Plunge as China’s Probes of U.S.-Listed Firms Jolt Investors

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HONG KONG—China’s regulatory probes into three technology companies shortly after their U.S. listings have caught global investors off guard, showing the risks of owning shares in rapidly growing businesses that have come under Beijing’s microscope.

On Tuesday, the American depositary receipts of newly listed Didi Global Inc. tumbled 20% after China’s cybersecurity regulator delivered a second blow to the ride-hailing giant two days after launching a review of its data security on Friday. The shares closed below the company’s initial public offering price.

A unit of the regulator announced Monday data-security probes into popular mobile apps operated by Full Truck Alliance Co. and Kanzhun Ltd., whose ADRs fell 6.6% and 16% respectively on Tuesday. U.S. markets were closed Monday for the Fourth of July holiday.

The three companies had raised close to $7 billion in total from U.S. initial public offerings in June, and their shares rose upon their trading debuts.

Didi’s Chinese ride-hailing app, Full Truck Alliance’s two truck-hailing platforms and Kanzhun’s online-recruiting app were ordered to stop adding users while the reviews take place. The Cyberspace Administration of China told app-store operators to take down Didi’s China service and said the Beijing-based company had collected personal information in violation of the country’s laws and regulations.

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