Shein, a leading Chinese online fast-fashion retailer based in Nanjing, is preparing for a major initiative in 2024.The company has confidentially filed for an IPO with the United States Securities and Exchange Commission SEC.This strategy, reported by The Wall Street Journal, involves top financial institutions like Goldman Sachs, JP Morgan, and Morgan Stanley.In the United States , confidential IPO filings allow companies to work with regulators before making details public.Typically, this information is released a few weeks before the market launch.
Sheins IPO is scheduled for 2024, a time anticipated to be ripe for capital market recovery.This follows a period where most IPOs had underwhelming performances, with the exception of firms like Arm Holdings in the tech sector.Shein Eyes 2024 IPO Amidst Market Optimism.
(Photo Internet reproduction)Valued at $66 billion in May, Sheins potential IPO could mark a significant milestone.It aims to exceed the 2021 New York Stock Exchange listing of Didi, valued at $68.4 billion.
Sheins target valuation could reach up to $90 billion.Despite geopolitical tensions and an uncertain global market, Shein has shown remarkable growth.In 2022, it reported a record Gross Merchandise Value (GMV) of $23 billion and a net profit of $800 million.Management consultancy Heartman House projects that Sheins GMV could reach $100 billion by 2027, even in less favorable conditions.Shein in BrazilIn Brazil, Sheins revenue soared to R$8 billion in 2022, a 300% increase from the previous year.This growth stems from various factors like consumers reduced purchasing power and Sheins efficient production-to-market chain.The companys tech investments have made its app more than just a shopping site, introducing 10,000 new products each month.However, Shein faces growing scrutiny over tax payments and the sustainability of its production practices.To tackle these issues, Shein is diversifying.
Its transforming into a marketplace and venturing into local production partnerships, like with Coteminas in Brazil.Analysts from BTG have expressed concerns about the sustainability of Sheins low prices.
They warn that the companys rapid expansion might lead to significant cash burn.This was evident in Sheins latest funding round, which saw a 30% drop in valuation compared to the previous year.This shift indicates a more cautious approach to valuation in the current economic climate.