The Zhitong Finance App learned that the decline of Xiying-W (00625) increased by more than 8% in the afternoon. The low of HK$38.3 hit a new low since listing, and fell 20% from the issue price. The market value evaporated HK$40 billion in just four days after listing. As of press release, it decreased by 8.38% to HK$38.48, with a turnover of HK$259 million.
According to the prospectus, Xiying's net revenue in 2025 was US$41,847 million. The year-on-year growth rate has slowed to 8% from 41.1% in 2023; net revenue for the first quarter of 2026 only increased 1.1% year on year, and recorded book losses due to changes in the fair value of convertible and redeemable preferred shares. In addition, the US abolished the tax exemption policy for small packages under 800 US dollars, and the European Union will levy fees on low price small packages starting in July 2026, which will have a direct impact on the low price direct mail model.
Meanwhile, Hang Seng Index issued an index notice stating that Xiying complies with the requirements of the Hang Seng Composite Index's rapid inclusion rules and will be included in the Hang Seng Composite Index and its classification index after the market closes on September 14, and will take effect on September 15. It is worth noting that since Xiying-W is a “same share, different rights” structured company, according to the Hong Kong Stock Connect mechanism, such companies also need to meet additional requirements to be included in the Hong Kong Stock Connect mechanism, including liquidity requirements, listing length requirements (6 months+20 trading days after listing), etc.
China Investment Securities International previously indicated that based on 2025 net profit of 2,064 billion US dollars, Xiying's current offering corresponds to about 12.4-12.9 times PE. Compared with peer companies Inditex about 30 times and H&M about 22 times, Xiying's valuation was significantly discounted. However, the current listing valuation has shrunk by about 70% compared to the peak of the private equity market of about 100 billion US dollars in 2022. Behind the discount, it is implicit that the market is repricing its growth rate, profit fluctuations, and tariff risks.