Shein Valued at $26.5B in Hong Kong IPO Debut

Shein is set to debut on the Hong Kong stock exchange on September 1st with a valuation near $26.5 billion, significantly lower than its peak value four years ago. According to multiple reports, the company aims to raise about HK$13.6 billion ($1.73 billion) through the sale of shares priced at HK$48.56 each.

Founded in China and now headquartered in Singapore, Shein secured Beijing’s approval last month to make its initial public offering (IPO) in Hong Kong. The company's valuation has dropped by about 70% from a near $100 billion private market peak four years ago. According to Reuters, the drop reflects changing market conditions, rising costs, and slowing growth.

The funds raised will be used to finance technological capabilities and boost Shein's international presence. The company has faced criticism over labor practices, environmental concerns, and regulatory hurdles. In November 2023, Shein opened its first-ever physical outlet in Paris, which drew both customers and protesters concerned about alleged inhumane working conditions at the company’s suppliers.

Shein's journey to an IPO has been fraught with challenges. Plans to list in New York and London were held back by regulatory hurdles and pushback from lawmakers. According to Sky News, concerns among UK and US politicians included labor practices, design theft, environmental harm, and a lack of transparency about the company's founder and chief executive, Sky Xu.

The marked decline in Shein's valuation reflects broader market shifts. Analysts cited by Reuters noted that investor enthusiasm for e-commerce players has waned since the pandemic era. Additionally, increased competition from platforms like PDD’s Temu and added U.S. tariffs have hurt sales and dented future growth prospects.

According to UPI, Shein reported a $99 million loss in Q1 2025, down from a $395 million profit in the same period in 2024 due to U.S. President Donald Trump's scrapping of the so-called de minimis import tariff exemption on low-value packages. The European Union imposed its own flat $3.50 import tax on low-value packages coming into its single market, effective July 1, with Britain also expected to implement similar measures to the United States and EU in 2028.

Shein is under investigation by the European Commission and the U.S. Federal Trade Commission. Previous probes resulted in fines in France over alleged fake discounts and in Italy over greenwashing as fast fashion comes under increased scrutiny from regulators, according to Reuters.

The company has responded by improving disclosure of its sustainability initiatives, hiring consultants, and setting up an external ESG advisory board in 2024. Its annual ESG report grew to 118 pages last year, up from 28 pages in 2021. Despite these efforts, several European and Asian investors remain concerned about labor conditions, governance structure, regulatory scrutiny, and efforts to reduce carbon emissions.

Shein's dual-class share structure gives class A shares 10 votes each and class B a single vote. As a result, the company's four co-founders will hold 59.6% of overall shares but have 90% of the voting rights after the IPO, according to Reuters.

Critics argue that Shein's rock-bottom prices and aggressive marketing encourage shoppers to buy frequently and impulsively — behavior fundamentally at odds with sustainability goals. The company's vast and constantly changing website offers 4,700 new styles each day and more than 2 million apparel styles overall.

Shein reported greenhouse gas emissions roughly double those reported by Zara owner Inditex in 2025, even though Shein's annual sales of $41.8 billion were lower than Inditex's €39.9 billion ($46.54 billion), as reported by Reuters.