HK Stock Market Move | SHEIN-W (00625) rises nearly 7%; company pays US$100 million to settle FTC investigation; institution says US and European market demand is expected to recover successively.

SHEIN-W (00625) rose nearly 7% in morning trading. As of press time, it was up 5.74% at HK$38.34, with turnover of HK$16.0444 million. On the news front, SHEIN recently agreed to pay US$100 million to settle a US FTC investigation into delivery delays and consumer complaints, an amount equivalent to roughly 44% of SHEIN's profit in the second quarter of this year. SHEIN disclosed in its listing documents that its US business is under FTC investigation and warned that the outcome could result in significant financial expenditure. The disclosed settlement amount marks important progress in the investigation. Guosen noted that over the past year, the US and the EU successively eliminated the de minimis tax exemption for small parcels, directly creating incremental tariff costs for the company; after the company passed on costs through price increases, consumer orders were suppressed in the short term. However, on a quarterly trend basis, the US market has already shown sequential improvement, and the European market is expected to recover steadily thereafter. We expect revenue growth of around high single digits in 2027-2028. The bank also noted that a decline in oil prices would help profitability rebound.