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Shein shares fall on Hong Kong trading debut after HK$26bn IPO
The fast-fashion retailer priced its Hong Kong IPO at HK$48.56, raised HK$13.6bn, and slid to push its valuation below $25bn before ending down 4% below the offer price at HK$46.62.
Shein made its long-awaited stock market debut in Hong Kong, pricing the IPO at HK$48.56 and valuing the company at just over $26bn, after attempts to list in the US and UK were blocked amid forced labor concerns, the Guardian Business reported.
Shares traded down sharply minutes after the flotation, falling as much as 10% and driving the online retailer’s valuation below $25bn. By the end of trading, the stock had recovered some ground, closing 4% below its offer price at HK$46.62.
The company raised HK$13.6bn in the listing and had been valued at nearly $100bn in past funding, reaching a $100bn valuation in an April 2022 fundraising round. Shein had been one of the world’s biggest listed fashion groups, with a valuation around that of H&M, while Inditex was cited at about $213bn.
The Guardian Business also linked the softer performance to regulatory changes affecting Shein’s business model of shipping low-value goods in small packages to benefit from import duty breaks. It swung to a loss of $99m in the first three months of this year, compared with net income of $395m a year earlier, after the US removed its “de minimis” exemption and the EU moves to introduce and phase out a duty on small parcels from outside the bloc.