Shein’s profits double ahead of blockbuster IPO listing

Fast fashion e-tailer Shein, which hit a record valuation of £1.5 billion ($2 billion) last year, has more than doubled its profits as it awaits to list on either London or New York's stock market.

According to sources, the fashion giant that sells dresses online for as low as £5, recorded £35 billion ($45 billion) in gross merchandise value in 2023.

The group’s profits surpassed the £557 million ($700 million) of net income it generated in 2022 and £880 million ($1.1 billion) in 2021, according to the Financial Times. To put it in context, H&M reported net profits of £652 million (SKr8.7 billion) and Inditex reported net profits of £4.6 billion (€5.4 billion) in 2023.

Established in 2012, the business has mushroomed due to its cheap clothing and appeal to Gen Z consumers. The company was founded in China and later moved its headquarters to Singapore.

Shein's Founder, Xu Yangtian, was born in China but followed his company in moving to Singapore. He holds 37% of Shein. Other major shareholders include HongShan, General Atlantic and Abu Dhabi sovereign wealth fund Mubadala.

Shein currently waiting for regulators in Beijing and Washington to approve its £71 billion listing. It was expected to hit the stock market last week, however, delays may point to Beijing’s attitude towards companies that were founded in China but reincorporated overseas.

If the listing takes place in London over New York, it will reflect Beijing’s willingness to let Chinese companies raise billions of dollars on Wall Street after its crackdown on Chinese social media site TikTok. Listings in New York for Chinese companies are reportedly rare, while the London Stock Exchange is craving a high-profile float to boost its fortunes.

It was initially reported that Shein was in talks with London Stock Exchange bosses at the end of last year. Should it go ahead in London, the Shein float would be one of the biggest blockbuster IPOs in the UK in many years.

Shein has already made meaningful ties to the UK with plans to open a hub in Manchester, which is the home of the UK fast fashion industry housing HQs for the likes of Boohoo and In The Style. It also acquired Manchester-based fast fashion brand Missguided from Frasers Group in October last year, marking its first UK acquisition.