Shein Shares of fast-fashion giant Shein fell 8% during their first day of trading in Hong Kong, as investors remained cautious about the company’s growth prospects and the regulatory and trade challenges that have weighed on its business.
The weak debut comes after years of delays and uncertainty surrounding Shein’s attempts to go public. The online retailer has faced shifting tariff and duty policies in the U.S. and Europe, alongside growing scrutiny of its business practices in Western markets. These challenges contributed to setbacks in its efforts to list in both New York and London, with Chinese authorities ultimately blocking those plans.
Valuation Falls Well Below Peak
Shein shares traded at around HK$44.60 ($5.68) during morning trading on Tuesday, giving the company a valuation of roughly $24 billion. That figure represents a steep decline from the company’s peak valuation of nearly $100 billion in 2022, highlighting the extent of the reset in investor expectations.
The broader Hong Kong market also weakened, with the Hang Seng Index declining 0.6% during the session.
Known for its ultra-low-priced fashion, including $5 tops and $10 dresses, Shein built its global presence through a highly responsive supply chain and a digital-first business model. However, changes to trade rules and increasing scrutiny have challenged some of the advantages that helped fuel its rapid international expansion.
Investors Remain Cautious
At the listing ceremony, Shein Chief Financial Officer Leigh Gui said the company would continue to focus on innovation,Shein Shares optimization and closer cooperation with supply chain partners.
Founder and CEO Sky Xu, who generally maintains a low public profile, did not speak during the event, although he later appeared onstage for photographs with Shein employees. He declined to answer questions from Reuters.
The subdued market reception suggests that investors remain unconvinced despite Shein’s significantly reduced valuation.
“The weak debut shows that even after the huge valuation reset, investors still don’t see Shein as obviously cheap,” said Charu Chanana, chief investment strategist at Saxo.
The performance marks a challenging new chapter for Shein Shares as it navigates regulatory pressure, changing trade policies and heightened investor expectations in its newly established Hong Kong market presence.
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