Shein down by over 10 per cent on the grey market; set to make its debut in Hong Kong on 1 September
The share price falls on the over-the-counter market, where shares are traded before they are listed on the stock exchange
(Il Sole 24 Ore Radiocor) - One day ahead of its debut on the Hong Kong Stock Exchange, shares in Shein have fallen by more than 10 per cent on the so-called ‘grey market’, that is, the unofficial market where shares are traded before they are officially listed on the stock exchange. At the Asian broker Futu, the share price fell by 12% to 42.7 Hong Kong dollars, compared with a placement price of 48.56 (according to market rumours). The fast-fashion giant is aiming for a valuation of around 27 billion dollars in its IPO tomorrow, a far cry from the nearly 100 billion dollars it was valued at in 2022 on the private market. Shein has put 280 million shares on the market at a price ranging between 47.60 and 49.50 Hong Kong dollars, raising up to 13.86 billion (approximately 1.5 billion euros) for a market capitalisation of HK$210.3 billion (the equivalent of €23 billion). The official offer price is expected to be announced later today.
Shein “is taking a bold step by going ahead with its stock market flotation despite signs that its growth is slowing. Although the company’s shares are not exactly a bargain, they are not to be dismissed either,” writes Jinjoo Lee, a columnist for the Wall Street Journal. The company, founded in China and headquartered in Singapore, has been hit by tariffs in the US and Europe, as well as by competition from Temu, TikTok Shop and Singapore-based Shopee. ‘Although its shares do not represent an unmissable opportunity,’ argues Lee, ‘they are not particularly expensive either. For new investors to decide to buy them, however, the company must first present a more convincing outlook.’
