Shein set for lacklustre debut after setbacks cause huge drop in valuation
The offering values Shein at around US$26.5 billion, far below its 2022 peak of nearly US$100 billion
Chinese fashion e-commerce giant Shein made its Hong Kong debut as an IPO on September 1, 2023, aiming to bring capital to capitalize on its rapid growth. The IPO valued Shein at around US$26.5 billion, significantly lower than its 2022 peak value of nearly US$100 billion. Analysts believe the lower valuation reflects slower growth, regulatory risks, and increased trade costs due to tariffs and duties.
Shein's net income shrank by 39% last year and it incurred losses in the first quarter due to higher logistics costs in Europe and the Middle East. Despite attempts to diversify into third-party marketplaces and acquiring US apparel brands, Shein faces challenges from rivals like Temu and a mounting regulatory scrutiny. The IPO serves as a capital-structure event, compensating early investors and restructuring Shein's debt and preferred shares.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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