Fast fashion retailer Shein is refueling its IPO ambitions by pivoting to a London listing, as its US listing remains in limbo, according to a Reuters report which cited two sources. However, the China-connected company, which moved its headquarters to Singapore in 2022, is said to still prefer a public debut in New York.

Why it matters: The choice of London as a listing venue is being seen as the second best option for Shein, whose potential US IPO continues to be viewed as a bellwether for the geopolitical state of play between the US and China.

Details: Shein reportedly said it would update China’s securities regulator over any change in its listing aim, and file with the London Stock Exchange as soon as this month, according to Reuters.

• Political headwinds Shein faces in the US, its largest market by revenue, show no sign of diminishing. Republican Senator Marco Rubio in April asked Secretary of Homeland Security Alejandro Mayorkas to investigate Shein and Temu on claims that ultra-low prices on the two platforms are a result of “a combination of” intellectual property theft, trade exploitation, strong backing from the Chinese government, and alleged use of forced labor. 
• The push follows a February letter in which the senator urged the SEC to block Shein’s IPO unless the company disclosed more details on “business practices and risks to their business.”
• In 2023, Shein emerged as the third-biggest online fashion retailer by net sales in America, after Amazon and Walmart, data conducted by ECDB and Statista showed.
• A source quoted by Reuters said that China’s securities regulator told Shein early this year it would not recommend a US listing due to supply chain issues. Shein’s rise globally is largely thanks to its huge pool of China-based suppliers that lower costs and enable a fast turnaround on new item production.

Context: Last year, despite stronger scrutiny of its business operations, Shein recorded over $2 billion in profits – a figure that had more than doubled from the previous year. The company sold a total of approximately $45 billion worth of merchandise globally during the period, according to a Financial Times report.

• As part of Chinese regulations issued in February 2023, China-based companies, including those incorporated offshore, are required to go through an official review process if they seek to list overseas.