Chinese online fashion retailer SHEIN is seeking an initial public offering (IPO) in the second half of this year, according to Reuters, with its popularity having the potential to disrupt other U.S. value retailers.

The company is expected to raise about $2 billion in a new funding round this month, Reuters reports, citing multiple sources familiar with the matter. Investors in the e-commerce retailer include United Arab Emirates' sovereign wealth fund Mubadala, venture capital group Sequoia Capital China, and Tiger Global Management, according to Reuters' sources.

The company's valuation is estimated to be $64 billion, Reuters reports. If the IPO becomes successful, it have the potential to be one of the biggest debuts of 2023.

Founded in 2008, SHEIN has grown rapidly in the online fast-fashion space, thanks mostly to its popularity on social media apps like TikTok and it's difficult-to-beat low prices. The company produces clothes in China currently and sells them in the United States, Europe and Asia.

The company is popular with Gen-Z and younger Millennial consumers, with popular trends like fashion hauls attracting users to the site due to its insanely low prices, like dresses for $10, for on-trend fashion. SHEIN operates entirely online, beneffing from younger consumers' preferences for direct-to-consumer shopping and the pandemic-accelerated e-commerce shift seen in the overall consumer.

Paul Day, global head of strategic communications at SHEIN told TD Cowen in an interview that SHEIN operates differently from traditional fashion retail. Instead of producing clothing based on projected demand, SHEIN measures demand "using small batch production models where we will test a wide range of fashion options to see what actually sells," Day said.

"Once we detect a demand signal, we're able to go to our production suppliers -- and these are all third party suppliers -- identify suppliers with capacity and then produce to meet that measure demand," Day added. This production model allows SHEIN to operate with no inventory and low waste, Day said.

That type of fast-fashion business is difficult for other value clothing retailers like TJ Maxx (TJX  ), Ross Stores (ROST  ), and Burlington Stores (BURL  ), as well as Amazon (AMZN  ), Target (TGT  ) and Walmart (WMT  ) to compete with as SHEIN's low prices may keep younger consumers seeking discounts shopping on its site instead.