Shein Shares Plunge 10% in Hong Kong Trading Debut Following Long-Awaited IPO

Shein Global Holdings struggled in its Hong Kong debut after a years-long push to launch an initial public offering, with the company valued at a fraction of what it was once worth. The shares fell as much as 10 per cent to HK$43.72 ($5.57) in early trading, compared with the IPO price of HK$48.56, before recovering some of the losses.

Shein’s shares saw heavy selling in early trading, with bids hit three times as often as offers were lifted. The listing serves as a test of investor appetite for internet retailers, an industry that has faced recent headwinds amid inflation, trade disruption, and consumer caution in key markets such as China.

“Shein’s many challenges are well-known to investors and are likely behind the sharp share price fall on IPO day,” said Vey-Sern Ling, managing director at Union Bancaire Privee. “Growth is slowing and losses rising amid stiff competition from both e-commerce and fast-fashion players. More critically, its business model continues to be disrupted by evolving international regulations.”

Shein raised HK$13.6 billion in the offering, giving the company a market value of a little more than $26 billion, far below its previous $100 billion valuation. Despite this, it remains one of the world’s largest listed apparel and fashion companies.

Since its valuation peak, Shein has faced mounting challenges, including higher tariffs, growing regulatory scrutiny, and intensifying competition from PDD Holdings’s Temu and Alibaba Group Holding’s AliExpress. The IPO valued Shein at more than 15 times forward earnings, according to calculations based on Bloomberg Intelligence’s estimates.

“With investors favouring AI and technology-related plays in Hong Kong, Shein’s appeal is relatively limited as a traditional e-commerce company that relies heavily on price competition,” said Shen Meng, director at Beijing-based investment bank Chanson & Co.

Founded in China and now based in Singapore, Shein grew rapidly as a beneficiary of the pandemic-era e-commerce boom. However, attempts to go public at the time faced regulatory and political hurdles in the US and UK, leading the retailer to pursue its market debut in Hong Kong.

The company secured support from several cornerstone investors, including Boyu Capital, Tiger Global Management, General Atlantic, Tencent Holdings, and UBS Asset Management Singapore, with existing and cornerstone backers agreeing to a six-month lockup period.

The retail portion of the IPO was 5.6 times subscribed, while institutional investors bid for 2.6 times the available shares. Shein stated it plans to use the proceeds to strengthen its technological capabilities, expand its global brand presence, support corporate responsibility initiatives, and fund general corporate purposes.

Nevertheless, analysts warn that increasing pressure from global trade policies, US tariffs, Europe’s import duties, and geopolitical scrutiny regarding acquisitions like Everlane continue to present significant risks to the company's global expansion.