LVMH Group Chief Financial Officer Disclosed: Chanel Who Buy It Is Not Easy!

Louis Vuitton (LV), the flagship brand of French luxury goods group LVMH, recently said that in order to meet the growing demand for online business in the mainland market, it will further increase the stock of bags and other luxury products in the future.

Driven by the favorable Chinese government's tariff cuts, Chinese consumers have begun to buy high-end fashion and accessories in the local market.

Louis Vuitton CEO Micheal Burke held an analyst conference in Paris, pointing out that brands are experiencing "unprecedented" growth in China.

Chinese luxury consumers have shifted their consumption of bags and watches from overseas to the mainland, pushing the growth of the market as a whole.

Analysts who participated in the analysts' meeting said that the growth of the Louis Vuitton market in China also benefited from the promotion of e-commerce.

Flavio Cereda, an analyst at Citibank (Citi), wrote in the Memorandum: "although the current consumption in mainland China accounts for only 1/3 of the Chinese luxury consumption, it has doubled its growth rate, and this proportion may increase to 50% in the near future."

Louis Vuitton launched online business in China in 2017, slightly later than Gucci (Gucci), earlier than Herm s (Hermes) and Prada (Prada).

Flavio Cereda points out that in the past 9 months, Louis Vuitton has sold its neighboring countries' stock to China's official website. At present, online channels contribute 8% of the Chinese market sales to the brand.

Rogerio Fujimori, an analyst at Royal Bank of Canada, said Louis Vuitton hopes that in the next few years, annual sales of watches and jewellery will reach 1 billion euros, with sales of 2018 euros in the 2018 fiscal year, and sales of clothing category has exceeded 1 billion euros.

Recently, Sino US trade relations have been tense, making luxury brands facing greater challenges in China, the world's largest market.

But Louis Vuitton remains optimistic about Asia and the US business, and analysts have revealed that third US bag production plants in Dezhou are already in operation.

"The healthy growth of Louis Vuitton in Asia and the United States should be reassuring for investors," Rogerio Fujimori said.

In June 6th, LVMH group's share price rose 2% to 357.1 euros / share, a record high, then slightly declined, closing at 350.35 euros / share.

When asked whether the LVMH group would buy Chanel (Chanel), the group's chief financial officer, Jean-Jacques Guiony, said that in terms of the current size of Chanel, (acquisition) is a challenge for any buyer. "The current valuation of Chanel is approaching 100 billion euros, far from the 50 billion euros often quoted by the media."

In June 2018, Chanel launched its first annual public earnings report in 108 years with an annual sales volume of US $9 billion 620 million.

Since then, there have been rumors in the market that Chanel is on sale.

Author: Jiang Jingjin