Online retailer of cheap fashion Shein will enter the Hong Kong stock exchange on September 1. The company’s market value could reach nearly 27 billion USD (557.6 billion CZK). This is according to a document published by the company before entering the stock market.
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Shein aims to raise up to 13.86 billion Hong Kong dollars from its initial public offering
Shein plans to offer 280 million shares, approximately 6.6 percent, at a price between 47.6 and 49.5 Hong Kong dollars. The initial public offering of shares could thus raise up to 13.86 billion Hong Kong dollars (36.5 billion CZK). The final price will be announced on August 31. The company intends to use the funds to finance its technological capabilities and strengthen its international presence. The company’s market value will be significantly lower than in previous funding rounds. In 2022, the company was valued at 98.2 billion USD, and in 2023 and April 2024 at 64 billion USD.
The company was founded in 2012 in China, but is currently based in Singapore. It built its empire thanks to very cheap clothing, a wide range of products, and aggressive marketing. It applied for permission to list on the Hong Kong stock exchange about a year ago and received it this July. In the past, the company unsuccessfully attempted to list on the New York and London stock exchanges. Last year, the company reported a net profit of 2.06 billion USD, but in the first quarter it fell into a loss of 99 million USD. The reason was partly the cancellation of the exemption for small shipments from import duties in the USA.
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Shein ranks among the largest online platforms in Europe
The company relocated its headquarters to Singapore between 2021 and 2022. According to analysts, the reason was an attempt to avoid growing global scrutiny of Chinese companies. However, it still benefits from a unique combination of China’s extensive and cheap textile industry and Singapore’s advanced logistics network for e-commerce. The number of the company’s customers in Europe grew to an average of 156 million per month by the end of last year. Shein has thus become one of the largest online shopping platforms in the region, alongside AliExpress, which had 193 million users, and Amazon with approximately 180 million users, the AFP agency reported. However, Shein also faces criticism over the impact of mass production on the environment and allegations of human rights violations. The company, however, claims it applies “zero tolerance” toward forced labor.
Initial public offerings in Hong Kong have raised approximately 41 billion USD so far this year. This is a record figure for this period and more than double last year’s 17 billion USD, according to LSEG data. Shein’s initial public offering is the largest in Hong Kong this year, surpassing the July offering by Momenta Global, which deals with autonomous driving and raised 751 million USD. Within Asia, it is the third largest IPO. Only the offerings of Chinese companies CXMT and China Resources New Energy were larger, raising 9.8 billion and 3.6 billion USD respectively on the domestic market, the Reuters agency reported.
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Source: ČTK
