Shein’s market capitalization fell by about $5 billion in its first week of trading in Hong Kong, closing 19% below its initial public offering price. The fast-fashion giant, which debuted on September 2nd, saw its value decline to $21.5 billion by the end of the week, down from $26.5 billion at its IPO. This significant drop makes it one of the worst-performing major IPOs in Hong Kong in recent history.
The company’s shares, which were priced at HK$48.56 ($6.21) each, ended their first week at HK$39.30 ($5.03). This performance ranks among the poorest for large listings in Hong Kong since 2020, with only a handful of other companies experiencing similar or worse declines in their first trading week. The weak debut comes after several years of attempting to list in various markets, including New York and London.
Analysts have cited several factors contributing to the poor performance, including concerns over geopolitical headwinds, plateauing growth, and increased regulatory scrutiny in key markets like the U.S. and Europe. Tariff changes and higher logistics costs have also impacted Shein's profitability, with the company reporting a net loss in the first quarter of this year after a profit a year earlier. Investors are also reportedly cautious about the fast-fashion sector generally, given sustainability concerns and intense competition.
