Luxury sector - News

[John Hjorth]

Ha-ha! , SD [ @SharperDingaan ],

 

Simple recipe, forget anything about raising kids with certain and characteristic values inherent, habits, manners etc., and gravestones, just produce a lot of demanding female 'serial acquirers'  [Swedish phenomen especially, I think], and your footprint will be eternal and ever lasting! 

 

Christ, I'm amused!  - CoBF on a Friday evening at its best! 

[John Hjorth]

On 11/22/2024 at 12:28 PM, John Hjorth said:

...These guys did not sponsor this bragging and marketing  - 'one bid only per bidder, please' - bidding war [dick size contest?],  their contributions, themselves personally, - their listed holding companies - and thereby also their co-shareholders, did!

 

So, for those of us who may own LVMH, CDI or Kering, here is a sneak peak view to the bang for your buck! :

 

<Link to TVL video deleted here [waste of space], John>

 

Here is a new video generated by the organisation called 'Rebâtir Notre-Dame de Paris' [translate from French to English : 'Rebuilding Notre-Dame de Paris', website : Link].

 

It was likely produced in connection with French President Macron visiting Notre Dame as the first visitor after renovation, re-build-up, and restoration, with his wife, yesterday, before the official opening on 8^th December 2024:

 

YouTube - Rebâtir Notre-Dame de Paris [November 30^th 2024] : L'intérieur de Notre-Dame de Paris se révèle ! [English : The interior of Notre-Dame de Paris is revealed!

 

 

Edited December 1, 2024 by John Hjorth

[UK]

https://www.bloomberg.com/news/articles/2024-12-01/bulgari-ceo-eyes-india-for-growth-as-china-luxury-demand-weakens

 

Babin downplayed the luxury industry’s slowdown, saying this year’s relative weakness is due in part to comparisons against an unusually strong 2023, when demand was fueled by consumer savings built up during the Covid-19 lockdown years.
 

[John Hjorth]

2 hours ago, UK said:

https://www.bloomberg.com/news/articles/2024-12-01/bulgari-ceo-eyes-india-for-growth-as-china-luxury-demand-weakens

 

Babin downplayed the luxury industry’s slowdown, saying this year’s relative weakness is due in part to comparisons against an unusually strong 2023, when demand was fueled by consumer savings built up during the Covid-19 lockdown years.
 

 

Thank you for sharing, @UK,

 

At least for for LVMH, Babin is right and has a point, so far. And trees do not just continue to grow into the sky , -there are limits for growth in any sector. The growth in this sector the last decade or so has been quite high, on average.

 

First time I recall having been listening to an interview with Jean-Christophe Babin. He appers basically optimistic, but still realistic, in the meaning, with a global brand, there is always something to do.

[John Hjorth]

Bloomberg - CityLab [December 3^rd 2024] : Notre-Dame Reopens ‘More Beautiful Than Before’.

 

There are some really stunning and beautiful photos included in this article, especially the first one of the nave, and those two photos taken from the same location and in same direction, one just post fire, the next after finished repair and renovation.

 

Of the 840 million EUR donated, 500 million EUR came from the luxury sector, Pinault & Kering EUR 100 million, Arnualt & LVMH EUR 200 million, and Bettencourt family & L'Oreal EUR 200 million.

 

CNN [April 16^th 2019] : France’s 3 richest families lead $700 million fundraising effort for Notre Dame.

 

According to this article French O&G company Total also donated EUR 100 million.

[John Hjorth]

Bloomberg - Opinion - Andrea Felsted [January 24^th 2025] : Luxury Needs Its Logos Back. Trump Can Help.

 

Subtitle : Bernard Arnault attending the inauguration underlines the importance of the US market to luxury brands.

 

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Felsteds take on recent global and geopolitical events and developments, viewed from the angle of the global luxury sector, perhaps here with a certain focus on Mr. Arnault. Quite speculative to me personally, but still a bit interesting, I think.

[james22]

Setting aside the politics, doesn't the democratization of luxury goods and good taste make the luxury sector significantly more risky than previously?

 

Today, when luxury goods are more accessible to ordinary people than ever before, the elite need other ways to broadcast their social position. This helps explain why so many are now decoupling class from material goods and attaching it to beliefs.

 

https://archive.ph/bDqLe

 

Or does the shift create opportunity?

 

How will the upper-class and hipsters display their status next?

 

[Dinar]

LVMH results are out

[John Hjorth]

8 minutes ago, Dinar said:

LVMH results are out

 

Let's go talk about it in the separate LVMH topic in the Investment Ideas forum.

[Spekulatius]

Hipsters disappearing is news to me.

[james22]

1 hour ago, Spekulatius said:

Hipsters disappearing is news to me.

 

Disappearing, becoming common: same thing

[Spekulatius]

Tough times in high end liquor (cognac) in this case:

https://www.remy-cointreau.com/app/uploads/2025/01/Remy-Cointreau-Presentation-CA-T3-24-25.pdf
 

I have a starter in this (bag holder so far) and don’t see this going anywhere yet. I also expect tariffs sooner than later.

Edited February 1, 2025 by Spekulatius

[John Hjorth]

Prada Group - Press Release [April 10^th 2025] : Prada Group Reaches An Agreement With Capri Holdings For The Acquisition Of Versace.

[Lollapalooza]

11 hours ago, John Hjorth said:

Prada Group - Press Release [April 10^th 2025] : Prada Group Reaches An Agreement With Capri Holdings For The Acquisition Of Versace.

Bag holding capri since the failed merger.

Added significantly yesterday on the acquisition news expecting a pop. Afterall, 1.3bn$ for a barely profitable brand (under capri mgt) on a 1.7bn$ marketcap should make some waves, non? 

Guess not...

In fairness the main brand (Michael Kors) is facing significantly head winds from the tariffs - but in time, this too shall pass (imo).

Dont mind to be a bagger for a bit longer and not planning to sell before 25-30$s. 

Edited April 11, 2025 by Lollapalooza

[John Hjorth]

Douglas Elliman & Knight Frank - 2025 Wealth Report

 

 

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Interesting stuff for those CofB&F members interested in the luxury sector.

[John Hjorth]

McKinsey and Company [November 11^th 2024] : The State of Fashion 2025: Challenges at every turn

 

 

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Report attached.

McKinsey and Company - The State of Fashion -2025-v2 - 20250428.pdf

[John Hjorth]

McKinsey and Company [January 13^th 2025] : The State of Luxury: How to navigate a slowdown.

 

 

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Report attached.

McKinsey and Company. - The State of Fashion Luxury - 20250428.pdf

[GorillaHunter]

Hi All. I am actually bullish on the luxury industry at this juncture. I have been spending time trying to understand what happened to luxury in the 1970s to 1990s with the Japan boom to see if there are analogies to what is going on with China today but it is important to point how that China is just so much bigger and the GDP/Capital so much lower that there is so much room to run. See my framework on how to think about luxury. I plan on posting some follow-up posts in due time. 

https://www.thegorillagame.com/the-luxury-flywheel-part-1/

 

Below is an excerpt. To be clear, I am describing the flywheel pretty bluntly. It is obviously more nuanced than this, but to the extent you get this flywheel going, it is very very powerful

 

[John Hjorth]

Hi @GorillaHunter,

 

Welcome to CofB&F! 

 

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Thank you for your post above and the link to your stuff on your substack account above. I'm looking forward to read more there, and I've started following your substack.

[Dalal.Holdings]

we are coming off peak globalization where these brands produced cheap products in cheap countries and sold it at huge markup, often to Chinese consumers looking for western cachet. I'm not sure if those tailwinds will persist going fwd. More like headwinds...

[GorillaHunter]

100% of these products are either produced in Italy, France, Spain or the US. You might be referring to coach or kate speed or michael kors, which I don't view as luxury. 

[John Hjorth]

1 hour ago, Dalal.Holdings said:

we are coming off peak globalization where these brands produced cheap products in cheap countries and sold it at huge markup, often to Chinese consumers looking for western cachet. I'm not sure if those tailwinds will persist going fwd. More like headwinds...

 

51 minutes ago, GorillaHunter said:

100% of these products are either produced in Italy, France, Spain or the US. You might be referring to coach or kate speed or michael kors, which I don't view as luxury. 

 

Like you, @GorillaHunter,

 

I'm personally in the camp, that the manufacturing footprint of the leaders in this industry is in another place than what posted above by @Dalal.Holdings. And It has also  absolutely nothing to do with actual Chinese customers active by now - for the long term.

 

Just spin, with no real,  documented basis, nor sources provided.

Edited May 11, 2025 by John Hjorth

[Dalal.Holdings]

https://www.reuters.com/business/retail-consumer/dior-unit-put-under-court-administration-italy-over-labour-exploitation-2024-06-10/

 

https://www.forbes.com/sites/pamdanziger/2024/06/24/italian-court-reveals-diors-unethical-supply-chain-and-puts-other-luxury-brands-on-notice/

 

https://runwaymagazines.com/2780-dior-bag-manufactured-by-illegal-workers-for-57/

 

They may be “made in italy”, but some have been exposed using Chinese firms using cheap Chinese labor

 

Quote

LVMH Group's revenue share worldwide from in 2024, by geographic region. In 2023, the Asia-Pacific region, including Japan, accounted for 38 percent of the French luxury group's global revenue

 

Sorry to burst your bubbles, but slowdown in China has been a key reason these stocks have trended down now over many quarters.

 

 

[Gregmal]

I mean LVMH is highly sought after after by new money types which in gross number terms is China. They’re the largest market of new money millionaires and such. 
 

In anecdotal terms, I don’t know anyone who’s actually from wealth that would be caught dead brandishing those tacky “Louis” prints. 

[sleepydragon]

41 minutes ago, Dalal.Holdings said:

https://www.reuters.com/business/retail-consumer/dior-unit-put-under-court-administration-italy-over-labour-exploitation-2024-06-10/

 

https://www.forbes.com/sites/pamdanziger/2024/06/24/italian-court-reveals-diors-unethical-supply-chain-and-puts-other-luxury-brands-on-notice/

 

https://runwaymagazines.com/2780-dior-bag-manufactured-by-illegal-workers-for-57/

 

They may be “made in italy”, but some have been exposed using Chinese firms using cheap Chinese labor

 

 

Sorry to burst your bubbles, but slowdown in China has been a key reason these stocks have trended down now over many quarters.

 

 

I think Hermes is like 50+% of revenue from china. Apple is 20%