The ultra-fast-fashion giant Shein is making headlines once again as it seeks to go public, a move anticipated to be the biggest listing in London in years. However, the company faces significant hurdles that could complicate or even derail its Initial Public Offering (IPO) plans. Despite its impressive growth, controversies surrounding Shein’s business practices and its links to China have attracted criticism from various sectors, raising questions about its future in the public market.

Shein, which has created a name for itself with intensely low prices on trendy clothing, has attempted to list its shares for more than a year. Originally, the company aimed for the New York Stock Exchange, but political tensions between the U.S. and China prompted a shift to the London Stock Exchange. While listing in London may seem less politically charged, it has not been without its own set of controversies.

Headquartered in Singapore, Shein generates most of its revenues from products manufactured in China—where it was originally founded. The company’s unique, fast-paced manufacturing model allows it to rapidly produce an extensive array of styles at remarkably low prices, contributing to a projected revenue of $50 billion this year. Yet, this same approach has drawn criticism for various reasons, including labor practices, copyright violations, and environmental concerns.

Concerns regarding Shein’s business ethics have reached the UK’s financial regulator, which has received multiple objections to the company’s IPO bid. Activist groups have voiced allegations connecting Shein’s supply chain to forced labor in Xinjiang, China, prompting a lawsuit from the advocacy group Stop Uyghur Genocide. Shein has countered these claims, asserting its commitment to a zero-tolerance policy for forced labor and hiring a forensic company to trace the origins of its materials.

Moreover, the British Fashion Council, along with other activist groups, has pointed to Shein’s lack of transparency, accusing it of potential greenwashing. These challenges have resulted in delayed approval for Shein’s listing, with the expectation that the process will require extensive scrutiny.

Adding to Shein’s operational challenges is the scrutiny from the UK’s Independent Anti-Slavery Commissioner about alleged human rights abuses within its supply chain. The company is also navigating the complex regulatory landscape of China, where it needs approval from local securities regulators to proceed with its IPO.

From an investment perspective, analysts are cautious. David Swartz, a senior equity analyst at Morningstar, emphasizes that the timeframe of these hurdles indicates that Shein’s IPO may not materialize soon—or at all, at least in the UK. This sentiment is compounded by Shein’s status as a “lightning rod for controversy,” particularly in light of ongoing public and political scrutiny.

Shein has initiated a charm offensive aimed at bolstering investor interest. The company has engaged with politicians and public figures to cultivate a supportive atmosphere for its IPO. In a move to improve its image, Shein has pledged €250 million ($262 million) to develop British and European designers and to promote sustainable practices in fashion.

However, amidst this effort, Shein faces competition that is only intensifying. Rivals such as Temu and even Amazon are expanding their presence in the low-cost fashion market, attracting consumers with similar offerings. This competitive pressure raises questions about Shein’s ability to maintain its market share as it enters the public arena.

In addition to market competition, Shein must also contend with changing regulatory environments. Recent proposals to tax low-value imports could significantly impact Shein’s business model, which currently benefits from exemptions for low-cost goods shipped directly to consumers. The looming threat of higher tariffs on imports from China creates additional uncertainty for potential investors.

In conclusion, whether Shein will successfully launch its IPO in 2025 remains unclear. The company’s explosive growth has come with increasing scrutiny regarding labor practices and environmental impacts. While Shein strives to position itself as a player in the sustainable fashion segment, the hurdles it faces—both regulatory and competitive—are substantial. As investors await clarity, Shein’s journey to becoming a publicly traded company will undoubtedly be one to watch.