Shein made its long-awaited debut on the Hong Kong stock exchange with shares tumbling as much as 10% in early trading on September 1. The IPO raised $1.7 billion (HK$13.6 billion) by selling 280 million shares at HK$48.56 each, valuing the company at $26.5 billion. This valuation is a significant drop, over 70%, from its peak of nearly $100 billion in 2022.
The decline in valuation and tepid investor demand underscore growing concerns about Shein's future prospects. The company faces intensified competition, geopolitical pressures such as increased tariffs in the U.S. and EU, and rising logistics costs, which are squeezing its low-price business model. Analysts like Kenny Ng of Everbright Securities and Jacob Cooke of WPIC Marketing + Technologies highlighted operational challenges, an uncertain international trade environment, and the impact of tariffs on Shein's main competitive advantage.
Financially, Shein's growth has slowed considerably. Its net revenue grew 8% in 2025, a sharp decrease from a 21% increase in 2024, and below its target. Profit also fell to $2.1 billion in 2025 from $3.4 billion a year earlier. In the first quarter of the current year, losses swelled to $99 million. The company plans to use the IPO proceeds to boost brand awareness, upgrade its technology infrastructure including AI, and expand its marketplace to reignite growth.
Some analysts, including Dickie Wong from uSMART Securities, expressed skepticism about the IPO, noting that a lot of the money raised would go back to earlier investors. Momentum Works CEO Li Jianggan stated that the valuation reset reflects more than just slower growth, attributing it to increased exposure to tariffs, regulatory risks, and competition. James Ooi, market strategist at Tiger Brokers, questioned whether sustaining growth was becoming too expensive, citing marketing expenses rising faster than revenue in 2025.
