Shein points to Hong Kong listing to take advantage of the broader investor base

Shein is using a list of Hong Kong to relieve the scrutiny of the investors of her supply chain and supply practices when she opened access to the new capital of Continental China and emerging markets, analysts said.

The Singapore -based company changed its public market ambitions to Hong Kong after not ensuring Chinese regulatory approval for an initial London planned public offer, Reuters reported last month, citing Fuentes.

While a successful list would significantly boost the Hong Kong market, the movement could also complicate Shein's efforts to position itself as a global company, instead of China.

Shein, who sells products such as $ 5 bicycle shorts and sun clothing of $ 18, has faced political and environmental criticism in the United Kingdom for its cotton supply and supply chain practices. The company has also faced accusations that its products contain cotton from the Xinjiang region of China, where human rights groups and the United States have accused the Chinese government of forced labor and other abuses. Beijing denies any irregularity.

Shein, who relocated his headquarters from China to Singapore in 2022, argues that enforces a zero tolerance policy for forced labor and requires that their contract manufacturers obtain cotton only from approved regions.

“If this is the only option that is now open for them, the Hong Kong market makes sense as a place to list a global business with a continental supply chain,” said Eliot Fisk, Hong Kong Capital Capital Markets consultant and former JPMorgan banker.

Shein did not respond to a request for Reuters comments.

Before pursuing a London list, Shein had also explored the list in New York. The company founded by China found regulatory obstacles and the political opposition of US legislators in their attempt to list in the United States.

“The list in Hong Kong would also help Shein avoid protests and the political setback that he could face in the United Kingdom,” said Craig Coben, former header of the capital markets of the Bank of America in Hong Kong.

It is not clear if Shein will seek exemptions for a possible Hong Kong list. According to Markets capital lawyers, several exemptions, including those related to dissemination, are available for great candidates for OPI in Hong Kong.

A list of Hong Kong would also position Shein for his eventual inclusion in the city's Connect program, facilitating the trade of cross -border actions between the investors of Continental and Hong Kong investors.

Shein would easily comply with market capitalization and other criteria required for the inclusion of shares of shares and attract continental investment, according to Manishi Raychaudhuri, CEO of the advisory firm based in Hong Kong, Emmer Capital Partners.

The Hong Kong Exchange reported a 255% year -on -year increase in the average daily turnover in southern trade (continental investors who buy and sell Hong Kong shares, in the first quarter of this year.

“Hong Kong would attract a dominant base of investors focused on the Asia and the market. London, on the contrary, would attract a greater proportion of world and developed market investors,” Raychaudhuri said. “The problems of the supply chain would have had more weight with the last group.”

($ 1 = 7,8488 dollars from Hong Kong)