Shein Makes IPO Debut at $26.5B Valuation, a Fraction of Previous Estimates | Vogue

Save Story Save this story Save Story Save this story Ultra-fast fashion giant Shein is now public, following several years of false starts. The Singapore-based company priced shares at HK$48.56 ($6.20), raising $1.74 billion and valuing it at $26.5 billion in pre-market trading. Shares fell 7% when the market opened on Tuesday morning. It’s been a rocky road to an IPO for Shein, whose valuation has steadily declined for several years amid geopolitical headwinds. It peaked in 2022 at $98.2 billion, sinking to $66 billion at the time of its most recent funding round in May 2023. And most recently, ahead of the IPO, the company was targeting a valuation of $27 billion, after pricing 280 billion shares between HK$47.60 ($6.07) and HK$49.50 ($6.31), with the goal of raising $1.77 billion. Shein’s fast fashion machine was once thought to be an investor’s gold mine. What happened? Since announcing its intention to go public at the end of 2023, the company has faced continuous setbacks. US regulators blocked its early attempts to float on the New York Stock Exchange, citing national security and forced labor concerns, and discussions in the UK were similarly ill-fated. Its valuation took another knock when allegations of forced labor linked Shein to production sites in Xinjiang (which the company has denied), and again when US tariffs took aim at China (where most of its suppliers are based). Then, US regulators closed the de minimis loophole , which previously allowed low-value packages to avoid import taxes and customs inspections (the EU followed suit in July, and the UK is weighing similar action for 2028). The shift dealt a blow to the global fast fashion model, which capitalized on the loophole. These setbacks have slowed Shein’s revenue growth, which has likely contributed to the lower valuation, says Lorraine Tan, who leads the Asian equity research team at investor insights firm Morningstar. “Shein’s growth potential is more limited moving forward,” she explains. “Revenue growth has already slowed to about 7.5% for 2025, which is much more pedestrian than the double-digit growth it had seen previously, and puts Shein in line with other fast fashion companies.” But its competitors — several of which have attempted to elevate their offering to distinguish themselves from the ultra-fast fashion standard set by Shein — are not as exposed to these geopolitical risks. Morningstar analysis shows that Shein’s operating margins sat around 4.1% in 2025, she notes, compared to 8% at H&M, 16% at Fast Retailing and almost 20% at Inditex. “The average value of items Shein sells is much lower, so the margins are lower, and it’s been difficult for Shein to pass on rising costs. That makes them more sensitive to marketing costs as well, and they’re obviously spending to acquire customers.” Shein has made efforts to change its image as an ultra-fast fashion behemoth. It sent a shockwave through the industry when it acquired former sustainable fashion darling Everlane earlier this year, stating plans to keep it intact as an independent brand. According to Jeff Trexler, associate director of the Fashion Law Institute at Fordham University, another key pillar of this strategy included Shein trying to downplay its Chinese roots while courting Western investors. The company moved its headquarters from Nanjing to Singapore in 2022, and in 2024, executive chairman Donald Tang (who recently announced his intention to step down before the IPO) claimed that Shein was essentially “an American company” in a speech at the Milken Institute conference in Los Angeles. Then, in November 2025, Shein opened its first physical store at BHV Marais in Paris, with plans to roll out the partnership across France. But the opening drew enough criticism that BHV owner Groupe SGM called time on the venture after just seven months, and plans to close the store by the end of the year. This came after local authorities hit Shein with multiple fines, including €150 million for allegedly misusing online cookies (which Shein said was “wholly disproportionate”) and €40 million for “deceptive commercial practices towards consumers” regarding price reductions (which Shein said its subsidiary had rectified a year prior). There was also an attempt to suspend Shein’s online marketplace in France, after French authorities launched an investigation into “childlike” sex dolls being sold by third-party vendors on the site. As of September 1, France’s fast fashion tax has gone into effect, a big step in the country’s attempt to curb fast fashion consumption. It makes sense, given the brewing anti-China sentiment in US and European policy, that Shein would try to appear more global, says Trexler. “There has been a wave of regulations from California and New York to the EU, which were partly motivated by environmental consciousness, but they also have a strong anti-competitive effect. There is a sense of defending local production against Asian interlopers. We saw this with TikTok first, the concern around a Chinese company having access to massive amounts of US consumer data, and now the national security angle could apply to Shein too.” (Per Bloomberg , Shein is waiting for the Committee on Foreign Investment in the US to conclude a national security review of its Everlane acquisition . Shein initiated the review itself.) “I think Shein would have had a much higher valuation had it managed to list in New York or London,” says Trexler. “That would have legitimized them as a global economic force.” Despite this, Tan says Shein seems to be in “a very healthy financial position” right now, and “probably doesn’t need to list at this stage”, but may be seeking an exit to cash out former private equity investors. Indeed, the company has said it plans to pay out $3.5 billion to previous investors after the IPO, almost double the amount it raised. It also said in its IPO prospectus that it planned to use 40% of funds raised on technology, and another 40% on growing awareness. In its prospectus, the company noted that its total orders skyrocketed from 715 million in 2023 to 1.09 billion for the 12 months ended March 31, 2026, but further growth is far from guaranteed. “There is no assurance that we will continue to grow at the same rate or at all,” Shein wrote. “For example, our growth will suffer if we fail to continue to expand into new markets and product categories or grow our marketplace business. A number of other factors may also cause our growth rate to decline, some of which are beyond our control, including increasing competition, emergence of alternative business models, declining growth of our overall market or industry, changes in general economic conditions, decreasing consumer spending, and changes in rules, regulations and government policies or the implementation and interpretation thereof.” “I do think Shein has got a lot of near-term challenges,” says Tan, “but I wouldn’t count this company down and out.”