Fast-fashion e-commerce platform Shein, which is planning to list in Hong Kong, is reportedly preparing to further lower its target valuation. Foreign media reports say the company is seeking a valuation of between $26 billion and $27 billion for its Hong Kong listing, a sharp decline from its historical peak.
According to an Aug. 13 HK01 report citing Bloomberg, Shein was considering opening its Hong Kong IPO to investor subscriptions as early as Aug. 20 and beginning trading around Aug. 28. At the time, the company was targeting a valuation of about $30 billion, although investor resistance could force it lower. Bloomberg subsequently reported on Aug. 17 that Shein had lowered its target valuation to between $26 billion and $27 billion and was seeking to raise about $2 billion, with existing shareholders potentially taking up roughly half of the offering. The size, valuation and timing of the IPO remained subject to change.
Bloomberg previously reported that Shein had been sounding out investor interest, but its earlier valuation target of $30 billion met resistance. Sources said existing shareholders could subscribe to roughly half of the shares offered in the deal.
According to people familiar with the matter cited in the report, Shein is expected to begin trading around the end of this month. However, the company is still discussing details, and the size, valuation, and timing of the offering could still change.
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Two unsuccessful attempts to list in New York and London
Founded in China and now headquartered in Singapore, Shein previously attempted to list in New York and London but failed in both cases. Its valuation once reached approximately $100 billion, but slowing growth caused by tariffs and competitive pressure from PDD Holdings’ Temu has since led to a steep decline in its valuation.
During institutional investor roadshows, investors reportedly made clear that they did not believe Shein could return to its previous high-growth trajectory. Compared with the $98.2 billion valuation investors assigned the company during a 2022 funding round, Shein’s current valuation has fallen by roughly 75 percent.
Based on Shein’s 2025 net profit of $2.06 billion, a valuation of $25 billion would imply a price-to-earnings ratio of only about 12 times. This suggests the market no longer views Shein as a rare, high-growth internet giant, but is instead valuing it more like traditional apparel retailers such as Zara and H&M.
Shein plans to offer up to eight percent of its shares, potentially raising about $2 billion, according to Reuters. The company’s draft prospectus also outlines protections for certain pre-IPO investors if shares are issued below specified conversion prices. Under those arrangements, some preferred shareholders would receive conversion-price adjustments or compensation in shares or cash.
Shein posts nearly $100 million first-quarter loss
According to Taiwan’s Economic Daily News, Shein’s sales growth began to slow following the United States’ elimination of the de minimis tariff exemption for low-value parcels and changes in accounting treatment.
Documents Shein submitted to the Hong Kong Stock Exchange show that the company recorded a net loss of $99 million in the first quarter of 2026, a sharp reversal from a net profit of $395 million during the same period in 2025.
Financial data show that Shein’s U.S. revenue fell to $2.04 billion in the first quarter of this year from $2.38 billion a year earlier, a year-on-year decline of 14.3 percent. The U.S. market accounted for 22.5 percent of the company’s quarterly revenue, down from 29.4 percent for the full year of 2023.
The company’s annual net revenue growth rate fell sharply from 41.1 percent in 2023 to eight percent in 2025, when total revenue reached $41.8 billion. By the first quarter of 2026, year-on-year revenue growth had slowed to just 1.1 percent.
Outside the U.S. market, the European Union also began imposing a €3 fee on each low-value e-commerce parcel imported into the bloc in July this year, as part of efforts to curb what it regards as unfair competition from mainland China.
Europe is an important market for Shein, accounting for roughly one-third of the company’s revenue in 2025, and the new policy could add further pressure to its operations.
To cope with tariffs on direct-to-consumer shipments, Shein has been forced to alter its business model by developing local warehousing in markets including Poland, Italy, and the Americas. While this can shorten delivery times, it also significantly increases warehousing and inventory-management costs.
In addition, as competitors such as Temu and TikTok Shop spend heavily on subsidies around the world, Shein was forced to increase marketing spending in the first quarter to maintain user engagement, directly eroding its previous profit margins.
Shein initially preferred to list in the United States, but its plans encountered obstacles because of scrutiny over its supply chain, including controversy surrounding Xinjiang cotton and broader geopolitical risks. The company subsequently turned to London before ultimately choosing Hong Kong for its listing in 2026.
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