Shein Global Holdings Ltd. is preparing for its highly anticipated initial public offering (IPO) on the Hong Kong Stock Exchange, aiming to raise as much as HK$13.9 billion ($1.8 billion). The fast-fashion retailer will offer 280 million shares at a price range of HK$47.6 to HK$49.5 each, with its debut scheduled for September 1. This pricing is expected to give Shein a market capitalization of approximately $25.7 billion to $26.8 billion.
This valuation marks a substantial decrease from its private market peaks, where it was valued at $98.2 billion in 2022 and $64 billion in 2023. The $26.5 billion IPO valuation represents about 0.63 times its 2025 revenue and roughly 12.9 times its 2025 net income. The company's revenue growth has slowed, with an 8% increase in 2025, and net income fell by 39% to about $2.06 billion. This diminished valuation reflects a shift in market perception, as investors no longer price Shein primarily as a hyper-growth technology platform but as a mature cross-border platform facing increased costs and competition.
A significant aspect of the IPO is the potential payout to existing preferred investors. Shein could distribute up to $3.5 billion in cash and additional shares to these investors, whose protections were triggered by the lower IPO valuation. This includes approximately $2.2 billion in cash under conversion-adjustment protections if the IPO is priced at the bottom of the range, and 19.6 million additional shares. Furthermore, about $1.33 billion in additional payments to preferred shareholders are expected. These payouts, totaling roughly $3.5 billion, are nearly twice the anticipated IPO proceeds of about $1.73 billion.
Despite a fully covered IPO order book, retail demand has been less enthusiastic, according to a Hong Kong broker. Institutional support comes from cornerstone investors, who have committed approximately $383 million, representing about 22% of the offering. Existing shareholders like Boyu Capital, Tiger Global, and General Atlantic are among these participants. Shein plans to use the IPO proceeds to strengthen its technology capabilities and expand its global business, although the structure of the offering also provides an exit route for earlier investors.
