Shares of Shein, a company focused on selling cheap clothing online, are weakening during their debut on the Hong Kong Stock Exchange today. The company has recently been grappling with the negative impacts of tariff changes in the United States and Europe. In addition, the enterprise faces criticism over its working conditions and the environmental impact of its activities.
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Opening Day Stock Price Fluctuations
The company set the IPO price of its shares at 48.56 Hong Kong dollars. Shortly after the start of today’s trading, the share price fell by about ten percent, dropping below 44 Hong Kong dollars. Later, however, it erased a large part of the losses.
The issue price valued the entire Shein company at 26.5 billion US dollars. In contrast, during a funding round in 2022, investors valued the business at nearly 100 billion USD.
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Analysts Voice Concerns as Shein Swings to $99M Q1 Loss
According to Reuters, investors and analysts are now concerned about Shein due to weaker growth, higher business costs, and stricter scrutiny from regulatory authorities. In the first quarter of its financial year, the company swung to a loss of 99 million USD, compared to a net profit of 395 million USD in the same period of the previous year.
Shein is a Chinese company, but it is headquartered in Singapore. The firm is known for selling dresses for five dollars and jeans for ten dollars, with customers from approximately 160 countries shopping on its platform.
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Source: Reuters
