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A customer holds shopping bags with a Shein logo in the first physical space of online fast-fashion retailer Shein on the day of its opening inside the Le BHV Marais department store, the Bazar de l'Hotel de Ville, in Paris, France, November 5, 2025. REUTERS/Sarah Meyssonnier/File Photo Purchase Licensing Rights, opens new tab
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Summary
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Filing cites general reputational risk from negative publicity
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Shein does not mention specific China supply chain issues
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China objected to references to Uyghur forced labour risk in earlier filings, a source says
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Shein highlights 7,500 contract manufacturing partners and its LATR inventory system
July 27 (Reuters) - Shein's Hong Kong IPO filing published on Sunday made no specific mention of risks linked to allegations that its clothes contain cotton from the Xinjiang region, where the U.S. and human rights groups say government-sponsored forced labour programmes target Uyghur minorities.
Beijing denies any abuses, and Shein has consistently maintained there is no forced labour in its supply chain.
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Online fast-fashion retailer Shein shifted to seeking an IPO in Hong Kong after its supply chain risk disclosure became a major sticking point in its attempts to IPO in New York and London, according to a source with direct knowledge, as China's regulator could not accept a filing that mentioned Uyghur forced labour as a risk.
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Those filings included a statement about compliance with the Uyghur Forced Labor Prevention Act, a U.S. law aimed at preventing imports of goods produced by forced labour.
In London, the Financial Conduct Authority gave its green light to the filing, but the China Securities Regulatory Commission withheld its approval, effectively blocking the listing, and Shein eventually shifted to a Hong Kong listing instead.
Shein did not immediately respond to a request for comment on the supply chain issue.
The legal and political tightrope Shein had to walk was evident at a UK parliamentary hearing in January 2025 when Shein's EMEA general counsel Yinan Zhu avoided answering repeated questions from lawmakers on whether the company uses cotton from China or from Xinjiang.
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Shein's London filing was confidential so the exact wording used was not made public.
How much would Shein be worth?
How much would Shein be worth?
Shein was seeking a valuation of $40-$50 billion in its IPO, Reuters reported in July, a far cry from the $100 billion value that media reported it was given in a funding round in 2022.
SHEIN market cap
Shein
(estimated)
050100150
Chart explorer. Use arrow keys ← → to navigate.
193
148
50
24
Inditex
Fast Retailing
Shein
H&M
Note: in billions of US dollar.
Source: LSEG dataMiyoung Kim
In its Hong Kong filing, under the risks disclosure section, Shein used only general terms to describe the potential reputational risks posed to its business.
"Negative publicity associated with our brand, business partners or industry may reduce the value and attractiveness of our brand and products," the disclosure said.
Throughout the prospectus, the advanced technological integrations of Shein's supply chain and the agility presented by its 7,500 contract manufacturing partners were highlighted multiple times.
The disclosure says its Large-scale Automated Test and Reorder (LATR) operating system structurally minimises production and keeps inventory levels low.
Shein's revenue growth more than halves to 8% in 2025
Shein's revenue growth more than halves to 8% in 2025
Revenue growth further eased to 1% in the first quarter of 2026 as it grapples with the US removal of an import duty exemption on small packages
SHEIN IPO
Fast
Retailing
H&M
Inditex
Shein
05101520%
Chart explorer. Use arrow keys ← → to navigate.
12.2
1
7.5
21
9.6
2
3.2
8
FY 2024
FY 2025
Annual revenue growth rate of Shein and other global fast fashion brands
Source: LSEG, Company dataMiyoung Kim
As a company reliant on factories in China that only sells outside of the world's second-largest economy, Shein has the tricky task of keeping both Western and Chinese regulators on side.
Hong Kong provides a neat compromise for Shein, as a capital market where it can raise money from a range of global investors, while also being under the influence of Chinese regulators, said Lerong Lu, a reader in law specialising in international financial law and financial technology at King's College London.
"Chinese companies listing in New York or London tend to attract more political and regulatory scrutiny, whereas Hong Kong is seen as more safe," Lu said.
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Reporting by Helen Reid in London and Casey Hall in Shanghai; Editing by Sonali Paul
Our Standards: The Thomson Reuters Trust Principles., opens new tab
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Thomson Reuters
London-based reporter covering the European retail sector through a global lens. Focusing on companies including Adidas, H&M, Ikea, and Inditex and analysing corporate strategy, consumer trends, and regulatory changes, Helen also covers major supermarket groups like Ahold Delhaize, Carrefour, and Casino. She has a special interest in sustainability and how investors push for change in companies. Previously based in Johannesburg where she covered the mining industry.
Thomson Reuters
Casey is the Shanghai bureau chief and a senior correspondent covering companies in China, reporting on the biggest issues facing local and global businesses operating in the world's second largest economy. The Australian-born journalist has been based in Shanghai since 2007.
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Read Original at Reuters →