Back in July, Jim Cramer of Mad Money fame tried to warn investors about Chinese ride-hailing giant DiDi Global (NYSE:DIDI). Referring to Chinese initial public offerings (IPOs) in general and DIDI stock in particular, Cramer declared that “you should steer clear of them at all cost.”

I don’t necessarily agree that investors should avoid all China-based IPOs. Traders should keep an open mind and steer clear of broad generalizations, I believe.

For a while, though, it appeared that Cramer was right about DIDI stock. Due to crackdowns focused on cybersecurity and other issues, the share price declined after Cramer issued his warning.

But there may be a wrinkle in the story here. Governments can be unpredictable — and just as they can destroy businesses, sometimes they can also rescue them.

A Closer Look at DIDI Stock

DIDI stock actually started off with high hopes in the trading community. The IPO took place on June 30, and the stock began trading at $16.65 per share.

That first day saw some wild price action. The shares rose as much as 28.6% from the IPO price, but only closed up 1% at the end of the trading session.

DIDI stock stayed close to the $15 area for a couple of days after the IPO. Unfortunately for the bulls, though, the share price was destined to decline after that.

After a rough July and an awful August, the stock limped into September at around $9. It felt as if the sellers would never give up control of the price action.

It’s also worth noting that DiDi’s trailing 12-month earnings per share is -$2.32. Hopefully, the company will be able to rectify this and provide a positive earnings profile in the near future.

One Problem After Another

Suffice it to say, the post-IPO developments concerning DiDi and other Chinese businesses haven’t generally been positive.

For one thing, the Chinese government initiated cybersecurity reviews of Didi and a number of other China-based companies.

As a result of that development, DiDi reportedly isn’t allowed to register new users.

Furthermore, it’s been reported that Chinese regulators have prohibited new downloads of DiDi’s app, and are considering the DiDi IPO a “deliberate act of deceit.”

On top of all that, China’s Ministry of Transport vowed to step up its oversight of the nation’s ride-hailing companies.

And in case all of that wasn’t bad enough, the Securities and Exchange Commission halted IPOs of Chinese companies in the U.S. until they provide enhanced disclosures of the risks posed to shareholders.

In light of all these issues, it’s not unreasonable to conclude that DIDI stock might get de-listed from the New York Stock Exchange.

Government to the Rescue?

Sometimes after the heaviest rain, a rainbow can emerge. In other words, good news can come after a series of unfortunate developments.

In a surprising turn of events, according to a Bloomberg report, Beijing’s municipal government has proposed an investment in Didi Global.

According to people familiar with the matter, this proposal would give state-run firms control of the ride-hailing company.

Apparently, under the preliminary proposal, Shouqi Group and other Beijing-based firms would acquire a stake in DiDi.

If the proposal pans out, investors can expect a swift end to the company’s regulatory problems.

It would be a dramatic plot twist, to say the least. Only time will tell whether the alleged proposal works out in DiDi’s favor.

The Bottom Line on DIDI Stock

There’s really no way to predict what the Chinese government, or any government for that matter, will do.

Let me also add that every report and rumor should be taken with a grain of salt.

Nonetheless, at least DiDi’s stakeholders can now have a glimmer of hope, as maybe the regulatory issues will be a thing of the past.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content — and crossed the occasional line — on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.