Shein Comes to Market… Finally

Shein’s long and tortuous path to the stock market reaches its culmination on Tuesday, when the fast-fashion retailer kicks off trading on the Hong Kong stock exchange.

The company begins its listing with a market capitalisation of about $26 billion, compared with an almost $100 billion valuation at its 2022 private-market peak. Shein debuts close to H&M’s $30 billion market value.

Shein raised $1.7 billion in the initial public offering, funds it plans to use to improve the technology underpinning its supply chain and inventory management as well as for marketing and other corporate purposes.

Shein built its empire making ultra-cheap clothing in China and shipping it to mostly US and European shoppers who drum up further interest by bragging about their deals online. Coming out of the pandemic, it was a winning recipe that fuelled a surge in the company’s valuation from $5 billion in 2018.

Behind that precipitous drop in valuation is a series of roadblocks that have tripped up Shein.

We also have the LVMH prize being awarded this week. See below for details on that.

Shein: What to Look Out For

Shares can be particularly volatile on the first day of trading, so it’s fraught to read too much into any stock market debut. A bad day can sometimes say more about banks and a company seeking an excessive valuation than structural problems with the business model.

That said, regardless of how the shares perform on Tuesday, a series of factors has led investors and analysts to sour on Shein over the past four years (and will come up again and again in the coming months):

• Environmental impact: Shein’s ultra-fast-fashion model faces growing scrutiny over textile waste, emissions and overproduction, with tougher rules in Europe potentially adding costs.
• Slowing sales and profitability: Revenue growth has cooled sharply and Shein posted a $99 million loss in the first quarter of this year, compared with a $395 million profit a year earlier.
• US tariffs: Higher tariffs have forced Shein to raise prices, eroding some of its low-price advantage.
• End of de minimis: The abolition of duty-free treatment for small packages has increased the cost of Shein’s direct-to-consumer shipments into the US.
• China-US tensions: Shein’s Chinese roots remain a liability as Washington increases scrutiny of Chinese companies (the retailer moved its headquarters to Singapore in 2022).
• Supply-chain scrutiny: Shein faces questions over labour practices in its supply chain, exposing the company to potential import restrictions and reputational damage.
• Competition: Temu and other low-cost e-commerce players have intensified competition, while established retailers are also expanding their lower-priced offerings.
• Regulatory and reputational risk: France has moved against ultra-fast fashion, while Shein’s acquisition of Everlane is facing US national-security scrutiny.

LVMH Prize: What to Look Out For

The LVMH Prize, one of fashion’s most important awards for emerging designers, will announce its 2026 winners on Friday. Nine finalists are competing for the main prize, which comes with a €400,000 ($463,000) award and a year of mentorship from LVMH. They range from Anil Padia, the event’s first finalist from Kenya, known for his elaborate crochet techniques, to Daniel del Valle Fernandez’s genderless styles of sculptural, vase-like silhouettes. The group also includes other emerging names from the US, Europe and Asia. Here’s the full list:

• Colleen Allen by Colleen Allen, United States, womenswear
• De Pino by Gabriel Figueiredo, France, womenswear
• Institution by Galib Gassanoff, Georgia, womenswear, menswear and genderless collections
• Julie Kegels by Julie Kegels, Belgium, womenswear
• Lii by Zane Li, China, womenswear and menswear
• Petra Fagerström by Petra Fagerström, Sweden, womenswear
• Ponte by Harry Pontefract, United Kingdom, womenswear and menswear
• The Vxlley by Daniel del Valle Fernandez, Spain, genderless collections
• Yoshita 1967 by Anil Padia, Kenya, womenswear

The Venice Film Festival

Also, the Venice Film Festival kicks off on Wednesday. Last year, the event’s red carpet offered sneak peeks at some of the fashion industry’s high-profile design reboots, with Alba Rohrwacher wearing Dior, Ayo Edebiri in Chanel, Julia Roberts sporting Versace and Jacob Elordi in Bottega Veneta.

Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.