1 day ago
Shein Shares Fall After Hong Kong Debut Highlights China Roots
Shein is a company that sells inexpensive clothes online.
It started in China and sends many products to customers in Western countries.
On Tuesday, it began selling its shares on Hong Kong’s stock market.
The company raised about $1.7 billion, but its share price quickly fell by about 10%.
Higher tariffs and delivery costs are making its products and business more expensive.
Shein also lost money early this year after making a profit during the same period last year.
The company had previously considered listing in New York and London.
Its Hong Kong listing brings attention back to its Chinese manufacturing roots.
Hong Kong welcomed the listing because it is trying to attract more major companies to its stock market.
Shein raised about $1.7 billion in its Hong Kong initial public offering, pricing shares at HK$48.56.
The fast-fashion retailer’s shares fell roughly 10% in early trading to about HK$44.
Shein reported a $99 million loss in the first three months of the year, compared with a $395 million profit a year earlier.
The company’s low-price model faces higher tariffs, logistics costs and pressure to raise prices.
Shein’s Hong Kong listing valued it at roughly $27 billion, well below its peak valuation.
- Who
- Shein, its investors and Hong Kong’s stock exchange.
- What
- Shein launched a Hong Kong initial public offering, but its shares fell in early trading.
- Where
- Hong Kong, with major manufacturing operations rooted in Guangdong, China.
- When
- Tuesday; the company reported results for the first three months of the year.
- Why
- Higher tariffs, logistics costs, regulatory scrutiny and weaker profitability have affected Shein’s business and listing plans.
Supportive View
Critical View
Value of the Hong Kong listing
Supportive View
The listing gives Shein access to Hong Kong’s capital markets and reconnects the company with the Guangdong supply chain it says is central to its business.
Critical View
Analysts said Shein missed a stronger listing opportunity because investor attention shifted toward artificial intelligence and tariffs, reducing its valuation and profitability prospects.
Effect of Chinese roots
Supportive View
Shein’s Chinese roots provide access to Guangdong’s small-batch, fast-response manufacturing system, which supports its rapid and affordable fashion model.
Critical View
The company’s Chinese connections have drawn scrutiny from Beijing, United States and European regulators, contributing to its move away from earlier New York and London listing plans.
Business outlook
Supportive View
Shein remains a major online fashion retailer, and its listing was viewed as positive news for Hong Kong’s efforts to remain a global financial hub.
Critical View
Higher tariffs, logistics costs and price increases are weakening Shein’s main low-cost advantage; the company also reported a loss and faces regulatory challenges in Europe.
Key facts
- IPO proceeds
- About $1.7 billion
- IPO price
- HK$48.56 per share, or about $6.19
- Early trading
- Shares fell roughly 10% to around HK$44
- Market value
- Approximately $27 billion at listing
- Recent result
- A $99 million loss in the first three months of the year
- Previous-year comparison
- A $395 million profit in the same period a year earlier
- Earlier listing plans
- Shein previously explored listings in New York and London
Quotes
Leigh Gui
Shein’s chief financial officer
“Shein has probably missed its golden listing window due to the shift of momentum toward AI and tariffs, which can affect valuations and profitability”
thehansindia.com
“Guangdong is Shein's roots, and the starting point of our journey”
thehansindia.com
Sources
Related news
Shein’s Public-Listing Plans Collapse Amid Valuation Losses
Shein Shares Sink 10% in Disappointing Hong Kong IPO Debut
Shein IPO Valuation Falls Short of $30 Billion Target
Shein Faced Billions in Investor Costs as IPO Approached
West Asia Crisis Lifts Oil as Global Shares Trade Mixed
US Sells 10-Year Debt at Highest Yields Since 2007
Saudi Aramco Sets Initial Bond Price Guidance
PSUs Invest in Climate Startups Amid VC Hesitation
Major Banks Back ICC's Green Trade Finance Principles
