Shein Group Ltd. is moving forward with the preparatory work for a possible Initial Public Offering (IPO) in Hong Kong, marking a significant step in the fast-fashion giant's long-term efforts to go public.
The company and its advisors are reportedly aiming to launch the IPO as early as the coming months, provided they receive approval from the China Securities Regulatory Commission (CSRC). Recent discussions with the Chinese regulator have indicated more positive signals, according to sources familiar with the matter.
Shein had confidentially filed for a Hong Kong listing, and this development follows previous attempts to go public in New York and London, as well as an earlier stalled endeavor in Hong Kong. The company was reportedly targeting a valuation around $40 billion in its latest Hong Kong filing, down from its peak of $100 billion in 2022. Shein was valued at $66 billion in a pre-IPO fundraising round in 2023.
The swift progress is crucial for Shein, especially as the EU recently scrapped its 150-euro de minimis exemption on July 1, impacting the favorable customs treatment that supported Shein's direct-from-China parcel model. The company also needs to secure CSRC approval as its products are predominantly made by third-party suppliers in China, even though its headquarters were moved to Singapore in 2022.
Shein experienced an unexpected delay and limited communication from the CSRC regarding its London IPO plans, which led to the refocus on Hong Kong. The company must file with the CSRC within three working days after submitting its IPO application in Hong Kong, in line with Beijing’s regulations for Chinese companies seeking offshore listings.
