Shein shares plunge 10% in Hong Kong debut after $1.7 billion IPO

Shein’s long-awaited Hong Kong debut began with a sharp fall, as shares dropped 10% from the fast-fashion retailer’s listing price. The company raised $1.7 billion, but its market valuation stood at about $26.3 billion, well below the nearly $100 billion valuation reached during private fundraising in 2022.

The listing followed failed efforts to float the company in New York and London, plans that faced regulatory scrutiny. Chinese officials approved the Hong Kong offering in July. Shein said it would use the proceeds to strengthen its technology and expand internationally.

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Zero tolerance

The retailer moved its headquarters to Singapore between 2021 and 2022. Analysts said the move was intended to limit growing scrutiny of Chinese companies. Shein’s European customer base reached an average of 156 million monthly users by the end of 2025, putting it among the region’s largest e-commerce platforms alongside AliExpress and Amazon.

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Revenue growth has converged to the pace seen by the fast fashion industry at below 10 percent in 2025.

The company’s rapid, low-price clothing model has attracted scrutiny over its environmental impact and allegations of human-rights violations. Executive chairman Donald Tang said Shein has “zero tolerance” for forced labor. The company also faces competition from other low-cost platforms and criticism over sustainability, privacy and copyright practices.

Shein reported net profit of $2.06 billion for 2025, but recorded a $99 million loss in the first three months of this year after the United States ended an import-duty exemption for small packages. The European Union has imposed a three-euro duty on items in packages worth less than 150 euros, while France plans a fee on ultra-fast-fashion items that could eventually approach 20 euros per garment.

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The fall in valuation does reflect that drop off in investor appetite for Shein’s shares.

Morningstar analyst Lorraine Tan said revenue growth had slowed to below 10% in 2025 and that the lower valuation reflected weaker investor appetite. Sustainable-fashion expert Ken Pucker said Shein had built a difficult-to-replicate model, but faced newly imposed duties, sustainability concerns, privacy and copyright issues, and competition. E-commerce analyst Juozas said the company’s near future would be marked by negative growth.

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Timing is not ideal given the company’s slowing growth. That said, it has been trying to go public for around five years, and I am guessing that many of its investors were eager to get paid out.