Shein lists in Hong Kong at $26.5 billion and slumps on the open

Shein Global Holdings Ltd started trading on the Hong Kong Stock Exchange on Tuesday, 1 September, after pricing its initial public offering at HK$48.56 a share. The deal sold about 280 million shares, raised $1.7 billion and valued the company at about $26.5 billion. Shares opened at the offer, dropped to HK$43.8, and finished the session around HK$48.50, almost unchanged on the day after an early slide of as much as 10 percent.

That valuation is about a quarter of the $100 billion figure attached to a 2022 private round. Shein is based in Singapore and was founded in China. It tried and failed to list in the United States and in London. Goldman Sachs, Morgan Stanley and JPMorgan ran the Hong Kong books. Institutional demand was 2.6 times the stock on offer. Retail demand was 5.6 times. That is solid and far short of the frenzy around recent mainland semiconductor and robotics listings.

Why the number shrank

In July the company said it lost $99 million in the first quarter, against a $395 million profit a year earlier. President Donald Trump removed the de minimis waiver that had let low-value parcels enter the United States duty-free. The United States is Shein's largest market. The prospectus said the firm would raise prices there to offset part of the new duties. It also said about 40 percent of IPO proceeds would go to technology and 40 percent to brand-building.

Kenny Ng of China Everbright Securities International said the discount to the offer reflected weaker financials last year and caution about trade policy and consumer mood. Chris Weston of Pepperstone pointed to the contrast with CXMT and Unitree, which drew far heavier oversubscription. Investors, he said, are choosier about which China-linked stories they want.

The model under tariffs

Shein's method has been high-frequency design, small production runs and cheap cross-border parcels. A BBC report in 2021 said the site added about 6,000 new items a day. That machine needs cheap postage and a tolerant customs rule. The de minimis change hits both. Competitors in Bangladesh, Turkey and Vietnam face the same shipping math but not the same political file. Shein's China origin, labour-audit record and data practices were the reasons U.S. and U.K. listings stalled.

A $26.5 billion public company can still spend. It cannot pretend it is still the 2022 private unicorn. The first-day tape said buyers would take the stock at the offer and would not pay up. Sellers appeared as soon as the bell rang. The close near HK$48.50 is an after-the-slide recovery, not a bid for growth.

What to watch next is U.S. order volume in the third quarter, the share of sales that moves outside America, and whether Hong Kong secondary trading stays near the offer or settles into a lower range. The listing ends a years-long attempt to find a market that would have it. The price says the market that said yes did so at a discount to the story Shein told when money was free.