Fast-fashion retailer Shein’s 3-year IPO odyssey may have cost it the ‘golden time’ to go public

Shein, the fast-fashion giant, has been on an IPO odyssey for three years, and some believe it may have squandered its "golden time" to go public. After finally securing approval for a Hong Kong listing from Beijing, investors are now questioning whether the blessing is enough to justify its $40 billion-plus valuation. The China Securities Regulatory Commission approved the listing this month, following Shein's unsuccessful attempts at going public in New York and London.

The company's recent filing revealed the pressures it faces, including higher costs, slowing growth, and mounting regulatory scrutiny in its largest markets. Revenue grew by 8% to $41.8 billion in 2025, a significant slowdown from the 20.7% growth in the previous year. In the first quarter of 2026, Shein reported a $99 million loss, following the U.S. removal of an import-duty exemption on small packages and a hefty one-time accounting charge.

Experts argue that Shein missed its chance to list early, and investors are no longer as enthusiastic about the retailer as they once were. Shaun Rein, managing director at China Market Research Group, stated that by waiting, Shein missed critical windows of opportunity. The company, which sells affordable clothing items such as $5 dresses and $10 jeans, is under pressure to reduce its valuation to $30 billion, down from the nearly $100 billion it commanded in a 2022 fundraising round.

Even at this lower valuation, it remains expensive, with a price-to-earnings ratio of 19 to 25 times for fiscal 2025 earnings.

Analysts view Shein as transitioning from a high-growth, technology-driven fast-fashion platform to a mature global apparel retailer. It is grappling with slower growth and sustained margin pressure, with analysts expecting its post-listing market capitalization to settle between $20 billion and $30 billion. The Hong Kong market Shein is entering has shifted its focus to AI and chip listings, leaving Shein's unique value proposition to be perceived as a pure clothing retailer.

China is pushing Chinese brands to list on mainland Chinese and Hong Kong exchanges, and Rein asserts that the future for Chinese companies lies in forgoing western markets and seeking local listings. Investors also face reputational and ethical risks due to alleged poor working conditions at Shein's suppliers, addictive features of its shopping app, and the environmental impact of shipping massive volumes by air.

The U.S. Federal Trade Commission is investigating Shein's U.S. business, potentially leading to significant fines.