(qlmbusinessnews.com Tues 2nd April, 2024) London, UK —
“From China to London: Shein's IPO Aspirations Soar with Doubled Profits”
Shein, the Chinese-born fast fashion juggernaut, has witnessed a meteoric rise in profitability, doubling its earnings to over $2 billion (£1.6 billion) as it awaits the green light for a stock market debut in either New York or London.
The online retailer, renowned for its rapid global expansion fuelled by strategic social media marketing, boasted a staggering $45 billion in sales last year, reports the Financial Times, drawing from insider sources.
With its headquarters now relocated to Singapore, Shein emerges as one of the fashion industry‘s most lucrative players, outpacing renowned names like H&M, Primark, and Next in terms of profitability. Despite this, the Spanish giant Inditex, owner of Zara and other popular brands, still holds the crown with profits reaching €6.9 billion (£5.9 billion) last year.
In a bid to secure its IPO destination, Shein has reportedly engaged in discussions with UK Chancellor Jeremy Hunt, exploring the prospect of a London Stock Exchange listing. The move is driven by apprehensions regarding the approval of its initial public offering by the US Securities and Exchange Commission. If London emerges as the chosen venue, Shein's IPO could mark one of the city's largest corporate debuts, valued at a staggering $90 billion.
The swift ascent of Shein, which acquired the Missguided online brand from Mike Ashley's Frasers Group last year, has intensified competition for UK-based online fashion retailers like Asos and Boohoo. This competition unfolds against the backdrop of a challenging market landscape post-pandemic boom.
Notably, Shein benefits from its direct shipment model, enabling it to bypass hefty taxes by shipping goods directly from China to consumers globally, including the UK and US. This strategy has sparked debates over tax regulations and prompted calls for reform.
Established by entrepreneur Chris Xu, Shein predominantly operates from China while catering to a global clientele. Despite facing fluctuations in valuation, with a peak valuation of $100 billion in April 2022, later reducing to $60 billion by May last year, Shein remains optimistic, eyeing a potential $90 billion valuation with its upcoming IPO.
While Shein refrains from commenting on its IPO aspirations, its unparalleled growth trajectory continues to captivate both investors and industry observers, underscoring its status as a formidable force in the global fashion landscape.
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