A clothing rail with multicoloured clothes
Online fashion giant Shein is reportedly filing paperwork to launch their company on the London stock exchange. Credit: Nick de Partee - Unsplash

The controversial fashion brand Shein is planning to file paperwork for a London share listing, according to reports.

It means that the company, notorious for selling fast fashion but also accused of using forced and excessive overtime labour, could become public in the UK, leading to even further growth and expansion.

Why is Shein filing for stock market listing in London such a big deal? Here is everything you need to know.

What is Shein?

Shein is an online fast fashion giant, widely known for its low price points and large array of stock, adding up to 10,000 new items to its website daily.

It was founded in China in 2008, but now has headquarters in Singapore. Shein’s sales have surpassed those of its competitors such as ZARA and H&M, generating £1.57bn profit in 2023. Its products are mostly produced in China.

Why are they controversial?

Shein has been widely criticised for having an unsustainable business model, focused on selling large quantities of cheap, low-quality clothing made of plastic-heavy materials. From their constantly expanding product catalogue, the company is producing around 6.3m tons of carbon dioxide a year.

The working conditions in Shein’s factories have also received a lot of criticism amid rumours of forced labour and unsafe conditions.

A BBC News report in May revealed that some employees of the the company’s suppliers are still working 75 hour weeks, despite their promises to improve conditions.

A phone with a stock exchange web page open
An IPO on the London stock exchange will generate additional money for Shein, which they will likely use to further expand and develop. Credit: Joshua Mayo – Unsplash

Why is Shein filling paperwork for a share listing?

Shein is registering with the Financial Conduct Authority, which regulate the UK financial services industry. If successful, it will enable the company to launch trading of their stocks – an initial public offering (IPO) – on the London stock exchange, meaning people can buy and trade the company’s shares.

It will help to generate additional money for Shein and could signal growth for the already-giant online fashion company.

Are they also filing for the US stock exchange?

Shein was met with resistance when it filed to enter the New York stock exchange in late 2023. Allegedly, the IPO has been stalled due to tensions between the government in Beijing and Washington making the company less appealing to US financial regulators. It led to the company’s valuation being cut by 30%, to £51.7bn from a previous £78.7bn.

Donald Tang, Shein’s executive chair, told the Financial Times in May that, while the company had made “progress” on changing the perception of Shein as Chinese-controlled, it had been “not enough” to admit them onto the US market.

How much is the company worth?

Around £51.7bn, making it the largest IPO to enter the London stock exchange in 2024 so far.

What do Gen Z think of Shein?

A pile of clothes
Gen Z account for around 18% of traffic to Shein.com. Credit: Alejo Reinoso – Unsplash

Gen Z’s verdict on Shein is split. While 3/4 of gen Z report that they want to shop more sustainably, this is not necessarily reflected in their buying habits, with 90% of gen Z admitting to shopping from fast fashion brands such as Shein.

They account for around 18% of traffic to the Shein website, meaning they shop on the website despite being aware of the negatives of fast fashion.

Financial reasons and convenience are understood to be the key drivers for this.