ALBAWABA — Chinese fast-fashion behemoth Shein has taken a step closer to its long-awaited stock market debut after winning clearance from the Hong Kong Stock Exchange’s Listing Committee, leading to what might be one of Asia’s largest initial public offerings (IPOs) in recent years.
The company aims to publish its preliminary prospectus in the week of July 27, and the IPO may start as soon as the end of August, people familiar with the situation said, though the final timeline is dependent to market conditions. Shein is ready to test the waters for institutional demand, with investor roadshows and marketing meetings already under way.
Shein is aiming for a valuation of $40 billion to $50 billion, a significant drop from the $100 billion valuation it secured in a financing round in 2022. The decreased aim reflects mounting pressure from investors as the retailer contends with sluggish growth, heightened regulatory scrutiny and more intense competition in the global fast-fashion sector.
The Hong Kong IPO comes after failed efforts to list in New York and London, where the company’s plans were delayed by regulatory and political concerns. Earlier this month, Shein also won clearance from China’s securities regulator, another crucial milestone after nearly a year of waiting for Beijing’s blessing.
But at the decreased valuation, Shein is still among the world’s biggest online fashion merchants. Sources told Reuters the corporation produced more than $40 billion in global revenue last year and $2 billion in net profit, highlighting the scope of its global business.
But it's a tough time for the company to go public. Sales growth and profit margins have been dented by new European charges on low-value e-commerce deliveries and intensifying competition from rivals like as Temu, causing investors to revisit the company’s long-term view.
If successful, the IPO would be the culmination of Shein’s years-long pursuit of a public listing and a boost to Hong Kong’s capital markets, which are looking for high-profile listings as investor interest in Asian equities rekindles.
