Shein targets valuation of just $27bn in stock market flotation

Online fast-fashion retailer Shein is to make its stock market debut targeting a valuation almost a quarter of the $100bn it was worth four years ago.

The Chinese-founded firm said on Monday that its initial public offering (IPO) in Hong Kong would see trading of shares begin on Tuesday 1 September.

The flotation aimed to raise up to $1.77bn (£1.3bn) from the sale of 280 million shares.

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The top end of the price range revealed would give Shein a market value of $27bn (£20bn) but much will depend on the final offer price, due to be set the day before the sale.

It suggests Shein risks a valuation below that $27bn figure - a far cry from the sum of up to $40bn mooted just last month.

In 2022, Shein was worth $100bn and seeking to take the world by storm through an IPO in New York.

But more than a year later it was rebuffed - only to be rejected by London as well.

Concerns among UK and US politicians and regulators included labour practices, design theft and harm to the environment.

Another was, and remains, the scant detail available on Shein's founder and chief executive, Sky Xu.

He is something of a recluse and that contributed to a perceived lack of transparency.

The chair of the business and trade committee of MPs wrote to the London Stock Exchange last year to check on its vetting procedures after representatives of the company were accused of failing to answer the committee's questions related to Shein's supply chains.

The company has also suffered financially as sales in key markets have slowed following the removal, last year, of a US import duty ‌exemption covering small value packages.

That affected every delivery to US customers as each was shipped from China.

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Why Shein has lost its shine

Europe was Shein's biggest market last year but now the company fears a double whammy.

That is because the European Union has also imposed a €3 duty on small parcels imported from outside the trading bloc.

The measures are designed to help protect domestic firms from ultra cheap Chinese retail models.

Shein warned in July that the EU's move could have a "material adverse effect on our business, financial condition and results of operations".

The marked decline ‌in Shein's valuation reflects concern over slowing growth and rising costs.

The shares sold in Hong Kong will also have one-tenth the voting rights of the shares held by the company's founders.

Co-founders Sky Xu, Maggie Gu, Molly ‌Miao and Tony Ren will control 90% of Shein's voting rights.

Winston Ma, a visiting professor at New York University School of Law, said: "Public investors are no longer paying for hyper-growth. They are underwriting a mature cross-border platform that must now defend its profit margins against trade tariffs, higher compliance costs, and regulatory scrutiny in both the US and China."

Shein plans to use about 80% of the cash ‌raised in the IPO to improve its technology and increase its brand and global
presence in a bid to shore up growth and sales.

It recorded a $99m (£74m) loss in its last quarter for which it mainly blamed an accounting charge.

However, higher shipping and marketing costs have also hit its bottom line.

Shein said in its prospectus that first-half 2026 revenue growth was expected to be broadly in line with the 1.1% rate posted in the first quarter.

The company is also facing a potential growth headwind in the US as its $80m purchase of the Everlane clothing brand there in May is facing a US national security review, according to Bloomberg News.

Shein was yet to comment on the report, according to the Reuters news agency.

(c) Sky News 2026: Shein targets valuation of just $27bn in stock market flotation