Shares in fast-fashion giant Shein fell sharply in their highly anticipated stock market debut on Tuesday as the firm listed in Hong Kong after a long quest to go public. The debut follows failed attempts to list in the US and UK, amid ongoing concerns over the company's labour practices and environmental impact.

Once valued at nearly $100 billion, Shein's market valuation at its Hong Kong listing stood at $26.3 billion. The company priced its shares at HK$48.56 each, raising approximately HK$13.6 billion ($1.7 billion) from the sale. However, by Tuesday morning, Shein's shares were trading 8.7% lower at 44.4 Hong Kong dollars each.

This disappointing market performance suggests that investors remain unconvinced about Shein's growth prospects. "The disappointing debut suggests the market is not convinced that Shein's growth can make a comeback," said Charu Chanana, chief investment strategist at investment bank Saxo. She noted that the firm faces increasing costs, regulatory scrutiny, and intense competition, particularly as investors are increasingly favouring technology companies.

For consumers, the slump in share price could signal that Shein's ultra-low prices are becoming harder to sustain, potentially leading to future price increases. The company's business model, which made it hugely popular among younger consumers, relies on sourcing the latest fashions at extremely low prices through a vast network of factories in China.

The Hong Kong listing represents the largest new share sale in the city so far this year and is being viewed as a significant test of investor appetite for the fast fashion industry. Shein, founded in China in 2008 and now headquartered in Singapore, has become a benchmark for ultra-fast fashion.

Fashion industry analyst Louise Deglise-Favre from GlobalData described Shein as a rare standalone e-commerce firm that can be assessed on its own merits. However, she highlighted that investors have become more sceptical towards the sector, especially after rivals like Asos and Boohoo have faced significant challenges due to regulatory scrutiny and fierce competition.

Concerns over sustainability and ethical issues continue to add complexity to Shein's market valuation. The company reported having more than 273 million active customers who placed over a billion orders in the year ending March 2026, according to a filing ahead of the listing.

Shein's journey to the stock market has been marked by geopolitical pressures and regulatory hurdles, particularly for Chinese companies with global ambitions. The firm's long and winding path to listing underscores the challenges faced by such companies in the current global economic and political climate.