Shein to price Hong Kong IPO at $26.5 billion valuation, Reuters reports
The fast-fashion retailer is set to raise about $1.7 billion as slower growth and tougher competition weigh on investor demand.
Shein is set to price its Hong Kong initial public offering near the midpoint of its marketed range, raising about $1.7 billion and valuing the company at roughly $26.5 billion, two people familiar with the matter told Reuters.
The company is expected to price the deal at HK$48.56 a share, near the midpoint of its HK$47.60 to HK$49.50 range. The offering would raise about HK$13.6 billion, or $1.73 billion.
The sources spoke anonymously because the information is not public. Shein did not respond to Reuters’ request for comment.
The valuation is about one-quarter of Shein’s nearly $100 billion private-market peak in 2022 and below its $66 billion valuation in a 2023 funding round, according to Reuters.
Shein, headquartered in Singapore and founded in China, launched its Hong Kong IPO on Monday. The overall order book was fully covered by Tuesday, Reuters reported.
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Subscription rates from institutional and retail investors are due to be published on Monday, one day before Shein begins trading on the Hong Kong Stock Exchange. Retail demand has been less robust, according to Alvin Cheung of Prudential Brokerage.
Shein plans to use about 80% of the proceeds to improve its technology and expand its brand and global reach. It has also agreed to pay up to about $3.5 billion in cash to some investors from earlier private funding rounds.
The company faces slower revenue growth, weaker earnings, shrinking margins, higher trade costs, tougher regulation and increased online competition. Goldman Sachs, Morgan Stanley and JPMorgan are joint sponsors of the IPO.