Shares in the fast-fashion brand Shein slumped as much as 10% as the China-founded company made its long-anticipated trading debut on the Hong Kong stock exchange.
The Singapore-headquartered company, once valued at almost $100bn (£74bn), went public on Tuesday pricing shares at HK$48.56, valuing the business at just over $26bn.
However, minutes after the flotation, which raised HK$13.6bn, the stock fell as much as 10%, pushing the online retailer's valuation below $25bn. Shein's share price recovered some ground to be 4% below its offer price by the end of trading, at HK$46.62.
"Let global consumers enjoy the sound of fashion," said Leigh Gui, Shein's chief financial officer, after a gong was struck to mark the start of trading.
The lacklustre launch as a publicly listed company comes after one of the longest-awaited initial public offerings in recent years, after plans to list in New York were blocked by regulators over forced labour concerns.
Shein also considered a £50bn flotation in London but faced similar questions about its supply chain from campaigners, MPs and investors.
The plunge in value has been driven by regulatory changes around the world that threaten its business model of shipping goods in small packages out of China to take advantage of tax breaks on low-value imported goods.
Shein swung to a loss of $99m in the first three months of this year, compared with a net income of $395m the year before, after the US removed its "de minimis" import duty exemption on small packages, hitting its sales in the country.
The EU is also cracking down on the loophole – introducing a €3 (£2.56) duty on small parcels imported from outside the trading bloc in June – and intends to phase it out, while the UK has said it will do the same by October 2028.
Nevertheless, the company has still become one of the world's biggest listed fashion groups, with a valuation around the same as the Swedish retailer H&M. The Zara owner, Inditex, has a market capitalisation of about $213bn.
Shein moved its headquarters to Singapore at about the start of 2022, a move viewed by analysts as designed to avoid increasing scrutiny of Chinese companies.
Founded by the entrepreneur Chris Xu, the company runs most of its operations from China but sells all its goods outside the country. It reached a valuation of $100bn in an April 2022 fundraising round, making it the third most valuable startup in the world at the time.
After forced labour concerns were raised, Shein said it had tightened its supplier policies, enforced through regular audits, with any child or forced labour violations becoming grounds for immediate termination of contract.