Shein, a Chinese online fashion shopping mall company that shook the fashion market with $5 skirts and $9 jeans, is pursuing an initial public offering (IPO) of the U.S. stock market.
The Wall Street Journal (WSJ) reported on the 27th (local time) that Shein applied for an IPO in the U.S. stock market behind closed doors. Shein has selected Goldman Sachs, JPMorgan, and Morgan Stanley as the listing directors, and stock trading is expected to begin next year.
Shein’s IPO could be one of the biggest IPO cases in recent years, WSJ said. When raising funds in May, Shein was valued at $66 billion.
Founded in Nanjing, China in 2008 and starting its business like any online shopping mall, Shein has been reborn as a comprehensive retailer with its own supply chain since 2012 and has now grown into one of the world’s largest fashion brands based in Singapore and used by hundreds of millions of people around the world.
The secret to Shein’s growth is its ultra-low price strategy and fast speed. Shein, which sells products in more than 150 countries except China, recorded $23 billion in sales and $800 million in net profit last year.
However, disputes over design plagiarism and controversy over the supply and demand of cotton in Xinjiang, China, are pointed out as obstacles to the U.S. listing. Due to the nature of the fast fashion platform, the so-called fake product controversy continues, and products are generally inexpensive but not free from the evaluation that the quality is poor.
Shein is also being investigated by the U.S. House Special Committee on China as to whether the U.S. uses cotton in Xinjiang, which points to human rights issues. Shein’s side is in the position of applying a zero-tolerance policy to forced labor.