Shein profits double amid IPO plans, regulatory audit
(MENAFN) The Chinese fashion behemoth Shein has reported a significant doubling of its profits, marking a notable milestone as it awaits regulatory approval from Beijing for its anticipated listing on either the New York or London stock exchanges. According to sources familiar with the matter, the online fashion retailer's profits soared to over USD2 billion in 2023, accompanied by an impressive gross merchandise value of approximately USD45 billion. Founded in China but now headquartered in Singapore, Shein has emerged as a formidable player in the global fashion landscape.
This surge in profits represents a substantial increase from previous years, surpassing the net income of USD700 million achieved in 2022 and USD1.1 billion in 2021, as disclosed in a financing document obtained by the Financial Times. In comparison, rival companies such as H&M and Inditex, the parent company of Zara, reported net profits of 8.7 billion Swedish krona (USD820 million) and 5.4 billion euros (USD5.8 billion), respectively, in their latest financial results.
Renowned for its trendy apparel catering to Generation Z consumers, Shein's impending IPO is poised to be one of the largest initial public offerings of the year, with the company commanding a valuation exceeding USD60 billion in its latest financing round. However, Shein has refrained from commenting on its financial performance, maintaining a cautious stance amid ongoing regulatory scrutiny.
The prospect of Shein's IPO not only underscores its remarkable growth trajectory but also serves as a litmus test for Beijing's approach towards Chinese companies that have relocated their headquarters abroad to mitigate geopolitical tensions. Moreover, it presents a pivotal moment for assessing Beijing's willingness to permit Chinese firms to raise substantial capital on international markets, particularly in the aftermath of regulatory crackdowns targeting the technology sector.
As Shein navigates the intricate regulatory landscape in both Beijing and Washington, its IPO journey reflects broader dynamics shaping the global investment landscape and highlights the evolving relationship between Chinese corporations and international capital markets.
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