Key facts
- Shein shares fell over 5% on Wednesday, their second day of trading in Hong Kong.
- The stock closed at HK$46, down from its IPO issuance price of HK$48.56.
- Shein's IPO raised $1.7 billion, valuing the company at $26.5 billion.
- Factors such as higher import duties, regulatory risks, and competition are impacting Shein's growth prospects.
Shares of online fast-fashion retailer Shein experienced a significant decline on their second day of trading in Hong Kong, falling more than 5% to close at HK$46. This followed a volatile debut session where the stock initially tumbled but recovered to near its issuance price. Analysts and investors attribute the weak performance to concerns over slowing revenue growth, margin pressures, and increased competition, compounded by higher import duties and regulatory risks in key markets like the U.S. and EU. The company raised $1.7 billion in its initial public offering, valuing it at $26.5 billion, a substantial decrease from its 2022 peak valuation of nearly $100 billion. Stabilization measures were reportedly employed to prevent a sharper decline on its debut day.