Fast-fashion powerhouse Shein has finally received Beijing’s blessing to move forward with a stock market listing in Hong Kong, according to a notice posted Friday on the website of China’s top securities regulator, the China Securities Regulatory Commission (CSRC). The approval clears the path for a public offering that previously fell through in both the United States and the United Kingdom.
A spokesperson for Shein declined to comment on the regulatory green light.
The online clothing retailer spent roughly a year waiting for Beijing’s approval — a process that required sign-off from the highest levels of China’s ruling Communist Party, according to a source with direct knowledge of the situation.
That source indicated Beijing has treated Shein as politically sensitive, citing concerns that the company could cause further embarrassment for China following a scandal in France involving a sex doll and widespread reports of poor working conditions at its supplier factories in China.
VALUATION NOW EXPECTED BETWEEN $40 BILLION AND $50 BILLION
At its peak in 2022, Shein carried a valuation of up to $100 billion. That figure was later scaled back as the pandemic-era surge in online shopping cooled and opposition from politicians, retailers, and regulators grew stronger. The company’s most recent private fundraising round, completed in May 2023, placed its value at $66 billion.
The source said Shein is now likely aiming for a valuation of $40 billion to $50 billion through its Hong Kong IPO. While that would be significantly smaller than its chief rival — Temu’s parent company PDD Holdings, which carries a market capitalization of $117 billion — it would still be roughly double the size of Swedish fast-fashion chain H&M, which is valued at around $24 billion and has lost ground to Shein in recent years.
FAILED ATTEMPTS IN NEW YORK AND LONDON
Shein was founded in 2012 by Chinese-born entrepreneur Sky Xu and originally based in Nanjing, China. The company, which now operates out of Singapore after relocating its headquarters there in 2022, sells items like $5 dresses and $10 jeans in roughly 150 countries worldwide.
Shein first attempted a U.S. stock market listing in November 2023, but that effort stalled in the face of mounting resistance from American lawmakers and regulators. The company then pivoted to London, where British financial regulators approved a draft prospectus — but the CSRC withheld its approval, blocking that path as well.
Shein’s lengthy struggle to go public reflects how geopolitical tensions have complicated the road for Chinese companies seeking international investment. It also illustrates how Beijing has tightened its oversight of major entrepreneurs since it abruptly halted the IPO of Jack Ma’s Ant Group at the last moment in 2020.
Rules adopted by the CSRC in 2023 gave the agency authority to review and block overseas stock listings that it determines could threaten China’s national interests. Even though Shein moved its headquarters to Singapore, it remained subject to those rules because the vast majority of its products are manufactured through a network of third-party suppliers based in China.
CONTROVERSIES OVER LABOR AND TRADE PRACTICES
Shein has faced criticism on multiple fronts. Competitors, regulators, and advocacy groups have raised concerns about its highly addictive app, labor conditions in its supply chain factories, and the environmental impact of shipping low-cost garments around the world by air.
Its business model — sourcing clothing in China and delivering it by air directly to customers’ doors — has also come under pressure as both the U.S. and European governments have moved to close customs loopholes and impose duties on inexpensive imported packages.
A successful Hong Kong listing would be a significant boost for the city, which has emerged as one of the world’s leading IPO destinations this year. Over the past 12 months, the CSRC has approved more than 180 other public offerings, according to public disclosures, helping fuel a surge in Hong Kong’s equity markets.
