Shein shares slip more than 3% on second day of Hong Kong trading
- The stock was trading at HK$46.94 in early trade Wednesday
HONG KONG: Shares of Shein slipped more than 3% on Wednesday, a day after a lacklustre debut session following a long-awaited initial public offering.
The online fast-fashion retailer’s stock tanked by as much as 10% on Tuesday but recovered to close to its HK$48.56 issuance price.
The stock was trading at HK$46.94 in early trade Wednesday.
Hong Kong’s Hang Seng Index was down about 0.9%.
Shein’s share price rallied late Tuesday and its rebound was the result of so-called stabilisation measures which can be applied to large listings to avoid sharp declines on a debut day, according to a source and analysts.
Shein raised $1.7 billion in its IPO which valued the firm at $26.5 billion, nearly a quarter of its peak of nearly $100 billion in 2022.
Higher import duties in key markets, growing regulatory risks and intensified competition from rivals are hampering Shein’s growth prospects, investors and analysts said.
Shein shares slide in long-awaited Hong Kong trading debut
“Shein’s weak performance reflects investors reassessing a growth story that has become harder to underwrite,” said Brendon Ho, head of investment advisory for Singapore at Arta Finance.
“Revenue growth has slowed over the past few years and margins are under pressure, while higher tariffs and customs costs in the US and EU are weakening the economics of its low-cost cross-border model.
Comments