Shein’s Hong Kong IPO Nears Amid Trade and Valuation Challenges

Shein, the fast-fashion giant, is one step closer to going public in Hong Kong. Its listing hearing is set for Thursday after Beijing gave the green light last Friday. The China Securities Regulatory Commission approved Shein’s IPO, allowing it to issue up to 341.6 million H shares. The company now has 12 months to complete the listing.

This hearing is the final hurdle before a possible debut on the Hong Kong stock exchange in September or October. Passing the listing committee means Shein can publish its prospectus, start investor roadshows, and set a price range. This stage will reveal the ongoing debate between the company and its shareholders about the valuation.

Four years ago, Shein was worth around $100 billion. Now, the target valuation ranges from $40 billion to $50 billion. However, some shareholders want a number closer to $30 billion. That would be a two-thirds drop from its previous value, despite Shein’s huge revenue. The valuation cut reflects growing concerns caused by new trade policies and tariffs.

Trade Policy Shakes Up Valuation

Trade rules have changed sharply and affected companies like Shein. The Trump administration ended the $800 de minimis exemption for Chinese imports in May 2025. This means many small shipments to the U.S. now face tariffs. The European Union followed with the removal of its €150 exemption on July 1, 2025. These changes raise costs for importers and sellers.

Shein’s closest rival, Temu, lost more than half of its daily U.S. users after these rules took effect. Shein has not shared comparable user data. But the shift in trade policy clearly pressures the fast-fashion business model. These tariffs and the end of duty-free exemptions have created a crisis in trade policy that hits companies on both sides of the ocean.

Regulatory Scrutiny and Legal Battles

Beijing has been rewriting its e-commerce law, adding more domestic oversight and legal countermeasures. This move aims to tighten control over online business activities within China. Meanwhile, the UK’s Competition and Markets Authority has been reviewing Shein and Temu since early 2024. The UK’s Financial Conduct Authority also examined Shein’s disclosures during a previous London IPO attempt.

In addition to regulatory pressure, Shein is taking legal action against Temu. The fast-fashion company is suing Temu in London’s High Court over copyright theft. This lawsuit highlights the fierce competition and the stakes involved in the global fast-fashion market.

The path ahead will test Shein’s resilience. Clearing the Hong Kong listing committee is just the start. Negotiating a fair valuation amid trade and legal challenges could prove difficult. Still, Shein remains a huge force in fast fashion, with a potential public debut on the horizon.

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