New Blow to Shein: Due to American Tariffs, the Chinese Company Must Postpone IPO

In recent weeks, we have continuously read and heard about Donald Trump’s tariffs, and it now seems likely that the Chinese company Shein will have to postpone its listing on the British stock exchange due to Trump’s tariffs.

Shein, which sells clothing items directly from thousands of Chinese factories at ultra-low prices worldwide, previously informed investors that its debut on the London Stock Exchange could happen as early as this Easter, according to the Financial Times, but the initial public offering (IPO) will be postponed to the second half of this year due to high tariffs in the U.S.

The company, which was valued at $66 billion during its last funding round in 2023, has never publicly confirmed a timeline or plans for an IPO that would provide the much-needed support to the weak London capital market.

Recall that Shein submitted confidential documents to UK regulators for a public listing of part of its shares in June last year, but it is evident that U.S. crackdowns are affecting Chinese e-commerce companies like Shein and Temu.

Specifically, the U.S. president announced earlier this month that the rule de minimis, which exempts goods valued under $800 from tariffs, is being abolished, and an additional 10% tariff will be applied to all Chinese goods, which is an additional blow to these Chinese merchants.

This decision has led to a backlog of packages at the border, prompting Trump to temporarily pause tariffs on cheap shipments from China, but only briefly while officials devise new ways to tax the millions of packages arriving in the U.S. every day. The entire uncertainty surrounding tariffs and U.S.-China relations weighs heavily on Shein’s IPO plans.

Shein has experienced significant growth in the U.S. since the onset of the COVID-19 pandemic, largely due to the de minimis rule, and a report from the U.S. Congress confirms that over 30% of shipments arriving in the U.S. under the de minimis rule come from Shein and Temu, while over 50% of packages under that rule originate from China. At least, that is what data from the U.S. Customs Service indicates.

The announcements and introduction of tariffs have shifted Shein’s focus to its supply chain, but IPO plans remain in place. Recall that Shein initially targeted New York for its listing but ultimately chose London after being rejected by U.S. regulatory bodies. Analysts at RBC Capital Markets stated this week that changes related to the de minimis rule pose a threat to the business models of Shein and Temu, which will have to raise prices due to the introduction of tariffs, consequently leading to reduced demand for their products in the U.S.