Shein, a global online fashion and lifestyle company, is preparing to launch an IPO. As one of China’s most prominent cross-border businesses, the company has garnered attention from investors for its digital supply chain system, international presence, and operational fundamentals. These factors may shape how the global market assesses its long-term growth prospects.
Shein expands globally as user base grows and efficiency increases
As a fashion enterprise with a global footprint, Shein’s primary peers are international fashion groups such as Inditex and H&M. The company operates across approximately 160 markets worldwide and has built a multi-brand fashion portfolio with a geographically diversified revenue base.
Shein differentiates itself through its proprietary LATR system, short for large-scale automated test and reorder. The system uses real-time market demand signals to guide product development, with the aim of reducing inventory risk and product testing costs.
Shein’s active customer base grew from 186 million in 2023 to 273 million in 2025, representing a compound annual growth rate (CAGR) of 21.2%, reportedly outpacing both Inditex and H&M. Morgan Stanley expects Shein’s net profit growth from 2025 to 2028 to outpace that of Inditex and H&M.
Shein has also sought to improve operating efficiency and cash generation. The company has committed to maintaining a dividend payout ratio of at least 50% following its listing.
Its inventory turnover stands at 36 days, compared with 71 days for Inditex, 114 days for Fast Retailing, and 164 days for Adidas. The figures suggest that Shein operates with a shorter inventory cycle than several major global apparel companies.
Shein looks to brand partnerships for additional growth
Shein is also seeking growth by extending its supply chain and distribution capabilities to external brands.
Building on its core self-operated fashion business, supply chain network, and global online platform, the company has begun working with outside brands through a model that combines distribution, supply chain support, and brand development. This takes the form of various brand empowerment initiatives, with external brands onboarded as part of an open, diversified, and collaborative multi-brand ecosystem.
Missguided provides one example of that approach. Shein acquired the fashion brand in 2023 after it had faced operational and financial difficulties, including supply chain inefficiencies, limited cross-border capabilities, and liquidity pressure.
Following its integration into Shein’s ecosystem, Missguided gained access to Shein’s supply chain and global online sales platform. Within a year, the brand achieved a turnaround, eluding bankruptcy and returning to growth, according to the company. This provides an early example of how Shein is applying its partnership model to external brands.
At present, Shein has established partnerships with more than 20 brands across various categories, including apparel, accessories, and home furnishings. In terms of its development roadmap, Shein will spend the next three to five years continuing to expand its brand portfolio, refine and iterate its brand cultivation system, and unlock new growth drivers to propel its overall business to the next level.
In terms of valuation, based on peer valuation levels, namely a price-to-earnings ratio of 25 times for Inditex in fiscal year 2027 and 20 times for H&M, Shein, with its differentiated model, global footprint, and strong operational metrics, is well positioned to command a valuation at least commensurate with, if not superior to, that of its international peers. According to Reuters, the company’s target valuation for this IPO is in the range of USD 35–40 billion.
The broader online fashion market is also expected to continue expanding. According to China Insights Consultancy, the global online fashion market grew from USD 522 billion in 2021 to USD 606 billion in 2025 and is projected to reach USD 792 billion by 2030.
Going forward, as Shein’s multi-brand strategy continues to roll out, it further penetrates emerging markets, and its product categories continue to expand, the company’s growth engines are expected to gather momentum in parallel, unlocking its long-term potential.
This article was published in partnership with Newslink.