Online fast-fashion retailer Shein has launched its Hong Kong initial public offering, targeting a valuation of up to $US27 billion ($A38 billion) and aiming to raise up to HK$13.86 billion ($A2.47 billion), according to filings and the company's prospectus.
The offering, which opened on Monday, comprises 280 million shares priced between HK$47.60 and HK$49.50 each. The final price is set to be announced on August 31, with trading expected to begin on September 1.
At the top of the price range, Shein would be valued at close to $US27 billion — a significant drop from earlier private fundraising rounds. The company was valued at $US98.2 billion ($A137 billion) in 2022 and at $US64 billion ($A89 billion) in 2023 and again in April 2024, as reported in the offering documents.
Cornerstone investors led by Boyu, Tiger Global, and General Atlantic have subscribed for approximately $US383 million ($A534 million) worth of shares, according to the prospectus. Additional investors including Tencent, Greenwoods, Taikang Life, and UBS Asset Management are also expected to take stock in the IPO.
The listing comes at a challenging time for the company. Shein has experienced slowing revenue growth and weaker core earnings, while shrinking margins have raised concerns about its expansion. The company faces headwinds from higher trade costs, tighter regulatory scrutiny, and intensifying competition across global e-commerce, as noted in the offering materials.
Shein, known for selling $US5 ($A7) dresses and $US10 ($A14) jeans to shoppers in about 160 countries, recently swung to a $US99 million ($A138 million) quarterly loss after the United States removed an import duty exemption on small packages. The company also recorded a $US328 million ($A458 million) fair-value charge on convertible redeemable preferred shares following an accounting change.
Despite these challenges, Shein's IPO is set to be the largest new share sale in Hong Kong this year, surpassing autonomous driving firm Momenta Global's $US751 million ($A1 billion) offering in July. It ranks as the third-largest IPO in Asia, behind CXMT's $US9.8 billion ($A13.7 billion) float and China Resources New Energy's $US3.6 billion ($A5 billion) listing, both of which took place on Chinese onshore exchanges.
The IPO also adds to a busy year for Hong Kong listings. According to LSEG data, Hong Kong IPOs have raised about $US41 billion ($A57 billion) so far this year, a record for the period and more than double the $US17 billion ($A24 billion) raised in the same period last year.