Fueled by price tags’ increments, the results of luxury brands during the 2nd quarter will surprise investors. That’s the summary of HSBC, which sees Europe, Japan and South Korea growing, while the USA will confirm the positive trend and China carries concerns over the (inevitable) impacts of its zero-Covid policy. HSBC believes the luxury industry to be resilient not just because its clients have more resistance to risks and uncertainty, but it’s also due to the financial performance of refuge goods (let’s think about the Hermès and Chanel’s bags), as they have pulled in a wave of middle-class consumers. So, here is what HSBC says about LVMH, Kering, Hermés, Prada Burberry, Moncler.
What HSBC says
The French giant is xpected to achieve good results for the first half of 2022, given the continuity of the growth of market share and operating leverage. Even with the challenging macroeconomic context, HSBC forecasts that LVMH’s sales will grow about 23%, with the Fashion & Leathergoods Division at +28%. For the second half of the year, LVMH should grow 18%: +22% for the aforementioned division.
HSBC forecasts that Kering’s sales will grow 16% during the second quarter, with Gucci up 7.8%, Bottega Veneta +15.4% and Saint Laurent +30.9%. During the 1st half of the year, the group’s revenue should increase by 21.5%: Gucci +13.4%, Bottega Veneta +17.9% and Saint Laurent +36.9%.
HSBC believes that, during a difficult macroeconomic phase, Hermès is one brand worth having in portfolios, because it may be the most resilient company in the industry. Analysts expect sales to grow 24.8% during the first semester of 2022. Leather goods should return slightly below the organic 10.5% growth expected for the full fiscal year 2022.
The sales of the group guided by Patrizio Bertelli, says HSBC, will grow 17% during the first half of 2022. The split by brand being: Prada +17%, Miu Miu and Church’s +16%.
HSBC claims that Burberry’s retail sales will grow 4.2% during the first quarter of its 2022/2023 fiscal year (which closes in June).
The company showed, throughout the years, of being a quality company, supported by a solid management system and many growth opportunities. Good trend for Stone Island, which should continue on its growth trajectory. The overall performance is expected to be of +42.8% during the first semester.