According to a Reuters report citing sources familiar with the matter, Shein is shifting its IPO plans to Hong Kong after failing to receive approval from Chinese authorities for a London listing.
The China-founded fast-fashion giant is expected to submit a draft prospectus to the Hong Kong stock exchange within weeks and aims to debut on the market later this year.
The change in strategy follows ongoing delays and minimal feedback from the China Securities Regulatory Commission (CSRC) regarding its London ambitions, despite having secured approval from the UK’s Financial Conduct Authority in March.
Sources indicate Shein had anticipated swift permission from Chinese regulators, but ongoing silence from the CSRC prompted a pivot to Hong Kong.
Previously, the company had explored a New York IPO as part of its efforts to bolster its global profile and appeal to major Western investors. However, its Hong Kong listing could hinder those efforts, putting its international credentials at risk.
The attempted London IPO has also been marred by scrutiny over Shein’s supply chain, with allegations connected to cotton sourced from Xinjiang and a developing legal challenge from a group campaigning against forced labor in China. Meanwhile, the company stated that it maintains a strict policy against forced and child labor.
These issues have made the listing politically sensitive for Beijing and complicated regulator approval amid strained U.S.-China trade relations.
Adding further complexity, recent rule changes in the U.S. have made it harder for online retailers to sell inexpensive items from China duty-free—a move that may affect Shein’s future IPO valuation, regardless of its chosen listing venue.
The de minimis exemption, which previously allowed goods worth less than $800 to enter the U.S. without tariffs, now imposes a minimum tariff of 30% on packages from China, while the exemption remains intact for other countries.
