00:01Fiona Sincotta is an analyst at Citi Index. Great to have you on the programme again.
00:05Fiona, look, a $27 billion price tag from a company that wants $100 billion.
00:12Is it getting a bargain or is it more hope than really?
00:17Yeah, I wouldn't say it would bargain. I mean, it's probably more mystic.
00:20I mean, you think about it, it would have a huge global customer base, it has a strong supply chain.
00:25But we are seeing sort of that sense that growth could be slowing, sales are slowing.
00:31There's obviously regulatory scrutiny and sort of questions over the sustainability of the demand.
00:36So I think that is what is being reflected in this lower valuation price that we're seeing.
00:42But Fiona, New York said no. London said no.
00:45What does it say that Hong Kong was the market willing to take Xi'an on?
00:50Yeah, so it's interesting.
00:52So they're obviously willing to sort of embrace the company that, as you noted,
00:58that London and New York felt uncomfortable with, especially with those questions over the supply chain.
01:04But I think also what's interesting here is Hong Kong is actively looking to attract Chinese or Chinese-linked companies.
01:12So it feels like this is a marriage that actually works both ways.
01:16Hong Kong looking for Xi'an and Xi'an also looking for Hong Kong.
01:19Now, Xi'an made its name on cheap and fast fashion.
01:24Do you think that model is sort of being picked apart at the seams?
01:28Or do you think investors just stop believing the story?
01:32I think it's definitely a challenging environment.
01:35It's a tougher environment than it's been.
01:37You know, consumers, I think, are very much looking for, you know, they're more conscious over quality, price,
01:45and sort of getting sustainable items as well, and sort of the consciousness of where things are coming from.
01:51And I think the other thing to keep in mind here is, yeah, as a result, the growth story just
01:56doesn't feel as strong in this sort of model as it once was.
02:00And I think once you sort of see that slowing growth, it does mean that we start to question then
02:05where does the valuation actually come from?
02:08OK, so if Xi'an's growth model is indeed slowing, what does it tell us about how shoppers everywhere are
02:16spending right now?
02:17Yeah, so I think, you know, shoppers are much more conscious about where their money goes.
02:22They're weighing up cost, quality, longevity, price before actually splurging out.
02:29And so, you know, I think that does mean that Xi'an, for example, and other very fast fashion houses
02:36are sort of seeing a problem
02:38because that's their selling point is actually being able to sell quickly at high volumes.
02:43And it does feel that we're sort of shifting away from that as a consciousness in the consumer changes.
02:50Fiona, always great talking to you. Thanks so much. Fiona, it's in Cotter.
