Shein, the ultra-fast fashion retailer, has received approval from the China Securities Regulatory Commission to pursue an initial public offering (IPO) in Hong Kong after previously unsuccessful attempts to list in New York and London [1]. The approval came only after Shein publicly re-embraced its Chinese roots, a shift from its earlier strategy of downplaying them [1]. However, analysts note that market enthusiasm for Shein has waned, with both investors and consumers less excited than in previous years [1].
Shein's financial performance has shown signs of deceleration. In 2025, revenue grew by 8% to $41.8 billion, a significant slowdown from the 20.7% growth recorded the previous year [1]. In the first quarter of 2026, Shein reported a $99 million loss, attributed to the removal of a U.S. import-duty exemption on small packages and a substantial one-time accounting charge [1]. The company's valuation expectations have also been revised downward. While Shein was valued at nearly $100 billion in a 2022 fundraising round and $64 billion in 2024, current market pressure is pushing for a valuation closer to $30 billion, according to Bloomberg, with some analysts expecting the post-listing market capitalization to settle in the high-$20 billion to low-$30 billion range [1].
Analysts such as William Ma of GROW Investment Group and Shaun Rein of China Market Research Group believe Shein has missed the 'golden time' to go public, with Ma noting that the current valuation is still demanding compared to peers like PDD, which trades at 9 times earnings, and established consumer names in Hong Kong at around 11 times [1]. Lenny Zephirin of The Zephirin Group describes Shein as transitioning from a high-growth, technology-enabled platform to a mature global apparel retailer facing structurally slower growth and sustained margin pressure [1].
The Hong Kong IPO market itself has shifted focus, now dominated by AI and chip listings, which may further challenge Shein's debut [1]. Shein did not respond to CNBC's request for comments [1].
CONCLUSION
Shein's approval for a Hong Kong IPO marks a pivotal moment, but the company faces significant headwinds, including slowing growth, declining profitability, and a less enthusiastic market. Analysts expect a much lower valuation than in previous years, reflecting Shein's transition to a mature retailer and the changing landscape of the Hong Kong IPO market.