Shein (0625.HK) priced its Hong Kong initial public offering at the lower end of its marketed range on August 28, raising HKD13.6bn ($1.7bn) in a listing that values the fast-fashion retailer at about $27bn, far below its peak private-market valuation.

The Singapore-headquartered, Chinese-founded company offered 280mn shares at HKD48.56 each, compared with an indicative range of HKD47.60 to HKD49.50. Its shares are due to begin trading in Hong Kong on September 1.

The Hong Kong public offering was subscribed 5.63 times, while the international tranche was 2.59 times subscribed, Shein said in a stock exchange filing.

The debut follows years of attempts to secure a public listing in New York or London, that were derailed by political and regulatory scrutiny. The company received approval from China's securities regulator for a Hong Kong share sale in July.

However, the IPO is taking place against a much less favourable backdrop than the one that propelled Shein to a $100bn valuation in a 2022 funding round. That valuation made Shein, founded in China and now headquartered in Singapore, one of the world's most valuable private companies, putting it alongside established fashion and retail giants. Its Hong Kong offering implies a valuation of roughly a quarter of that level.

The company built its business by combining very low prices with rapid production and online marketing, particularly targeting younger consumers. Its model relies on closely tracking consumer demand and producing large numbers of styles in small initial quantities before expanding those that prove popular. The strategy helped Shein grow rapidly during the coronavirus (COVID-19) pandemic, when consumers shifted heavily towards online shopping.

However, its business model has come under increasing pressure from trade policies, regulation and scrutiny over labour and environmental practices.

A key challenge has been the US decision to end the so-called de minimis exemption for low-value imports. The rule had allowed goods worth $800 or less to enter the United States without tariffs, helping companies such as Shein and Temu offer exceptionally cheap products directly to consumers.

Shein said the removal of the exemption had hurt its US sales and overall revenue growth. It has responded by raising some US prices to offset higher duties and taxes.

European regulators have also moved to tighten rules for low-value imports. The European Union introduced a €3 levy on low-value e-commerce imports in July, targeting a flood of inexpensive parcels, many from Chinese online retailers and prompting consumers to cut back on orders. Other countries such as North Macedonia and Turkey have taken similar steps. 

The company reported a net loss of $99mn in the first three months of 2026, compared with a profit of $395mn a year earlier. Its results also included a $328mn fair-value charge related to convertible redeemable preferred shares following an accounting change.

Shein said it had 281mn active customers in the year to the end of March, up more than 16% from a year earlier, with customers placing more than 1bn orders.

The company has also faced rising regulatory scrutiny in Europe and elsewhere. The European Commission and US Federal Trade Commission are investigating the retailer, while France has fined it over alleged fake discounts and Italy has taken action over alleged greenwashing.

Environmental and labour groups have continued to raise concerns about Shein's supply chain.

Greenpeace said in a March report that testing of 56 Shein products found hazardous chemicals above European Union legal limits in 18 items. Shein has faced wider scrutiny over working conditions and allegations of forced labour in its supply chain, which the company has previously denied.

The controversy has also attracted criticism in the United States ahead of the Hong Kong listing.

John Moolenaar, chairman of the US House Select Committee on China, criticised major US banks involved in underwriting the IPO, including JPMorgan, Goldman Sachs and Morgan Stanley.

"For major US banks to bankroll Shein’s IPO shows these institutions have no regard for human rights or the victims of forced labor who will be forced to pick cotton for Shein’s clothes," Moolenaar said in a statement on August 25.

He also accused Shein of being tied to the Chinese Communist Party and called on the banks to withdraw their support for the IPO. Shein has rejected allegations of forced labour and has said it expects suppliers to comply with its standards.

The IPO proceeds will largely be used to develop Shein's technology and strengthen its brand and global presence, according to the company's filings.

The Hong Kong listing also gives Shein access to a market that has become an increasingly important venue for Chinese-founded companies facing difficulties listing in the United States.

Shein's shares nevertheless appeared under pressure before their official debut. The stock fell more than 10% in Hong Kong's grey market on August 31, according to market data quoted by Reuters, suggesting investors remained cautious about the company's prospects and valuation.