Shein loses US$5 billion in market value after IPO in Hong Kong

Shein has lost around $5 billion in market value since its initial public offering (IPO), ending one of its worst debut weeks following a major listing in Hong Kong — a sign of investor concerns about the fast fashion retailer's growth prospects.

Even after a 3.2% rise on Monday, the first advance since the initial public offering, the shares closed the week 19% below the offer price of 48.5 Hong Kong dollars (R$31.7).

This is the second worst performance in the first five sessions among companies that raised at least US$1 billion in a listing in Hong Kong, behind only Baidu's 19.9% ​​drop. The company's market value fell from approximately US$26 billion to approximately US$21 billion.

The completion of a listing process that dragged on for years did little to allay concerns about Shein's weakening profitability, regulatory hurdles and intensifying competition.

Valued at about $100 billion during the e-commerce height of the pandemic, the company now faces a much tougher environment, leaving investors skeptical about its ability to resume growth. The losses also highlight the limited interest in traditional e-commerce companies as capital increasingly flows to companies linked to artificial intelligence and robotics.

"Shein's decline reflects the market's growing concern about fees, order processing costs and execution risks related to the transition to its platform model," said market analyst Catherine Lim.

The selloff was driven largely by specific concerns about the company, although it also reflected broader skepticism about cross-border e-commerce models in the face of tariffs, changes to exemption rules for low-value shipments and tightening regulation.

Investors' migration to artificial intelligence and technology stocks has compounded the weakness, but doubts about Shein's growth and margins remain the main concern, Lim said.

Shein arrived on the capital market at a time when its previously accelerated expansion was losing momentum. The company reported a loss of US$99 million in the first quarter, compared to a profit of US$395 million a year earlier. Revenue grew 8% in 2025, slowing down from the 21% increase in 2024 and falling below the company's target.

The poor performance adds to the turbulent start to the retailer's long-awaited listing. Once seen as one of the big growth stories of the pandemic era, Shein now faces slowing expansion, rising trade barriers and growing competition in global e-commerce.

Shein's debut already foreshadowed weak demand for the shares, which fell as much as 10% at the start of trading, before a recovery at the end of trading limited the drop to just 0.1%, to 48.5 Hong Kong dollars.

The shares traded well below the offering price for most of the session until a late rally reduced losses.