Investment Rating - The industry rating is "Outperform the Market" [6] Core Insights - The international gold price is fluctuating at a high level, which is expected to promote gold jewelry consumption due to its value preservation and appreciation attributes. After the public gradually accepts high gold prices, terminal consumption is likely to rebound [10][15] - The luxury goods market in China is showing signs of recovery, with significant performance differentiation among luxury groups in Q3. LVMH and Prada exceeded expectations, indicating a positive trend in the luxury sector [4][33] Summary by Sections Gold and Jewelry - The international gold price is currently at 935.60 RMB per gram as of October 24, 2025. The expectation of a continuous interest rate cut cycle in the U.S. supports a bullish outlook on gold prices, which may lead to a recovery in terminal consumption as the public adapts to high prices [10][15] - Investment suggestions include focusing on companies with a high proportion of fixed-price products, such as Laopu Gold, which benefits from stable pricing amid rising gold prices. Other companies to watch include Chaohongji and Mankalon [15] Duty-Free and Tourism - The new duty-free policies in Hainan are expected to significantly boost tourist flow and consumption. The policies include expanding the range of duty-free goods and allowing more categories of domestic products to be sold duty-free [19][21] - The tourism sector is recovering, with domestic travel increasing by 18.0% year-on-year in the first three quarters of 2025, reaching 4.85 trillion RMB in spending. Companies like Changbai Mountain and Dalian Shengya are recommended for investment, especially during the upcoming winter tourism season [27][29] Luxury Goods - Prada reported a revenue of 1.33 billion euros in Q3 2025, with an 8% year-on-year increase, maintaining a strong growth momentum for 19 consecutive quarters. The brand Miu Miu was a significant growth driver with a 28.6% increase [33][34] - LVMH's revenue reached 18.28 billion euros in Q3 2025, marking a 1% growth, with notable improvements in various business segments, particularly in the beauty sector, which is expected to drive future growth [64][69] - Kering Group's revenue declined by 5% in Q3 2025, but the decrease was less severe than expected, indicating a potential recovery in the luxury market [40][46]

Group 1 - The core viewpoint of the article indicates that Prada's revenue growth has slowed to single digits in Q2 and Q3, with the Prada brand experiencing its first negative growth since 2020 [1] - Miu Miu brand continues to grow faster than peers, but its growth is normalizing, requiring significant investment in advertising, manufacturing, IT infrastructure, and retail network expansion, which may suppress profit margin expansion [1] - The target price for the company has been raised from HKD 45 to HKD 53.8, while maintaining a "neutral" rating [1] Group 2 - The overall sales forecast for the group has been increased by approximately 1% for 2025, while forecasts for 2026 and 2027 have been reduced by about 1% due to adverse currency factors [1] - Operating expenses are expected to normalize, leading to EBIT and earnings per share forecasts for 2025 to 2027 being adjusted upwards by 3%, 1%, and 2% respectively [1] - The profit margin for 2024 is projected to remain at 23.6%, which is approximately 350 basis points lower than historical highs [1]

Core Viewpoint - The report from Credit Lyonnais indicates that Prada's third-quarter retail sales largely met market expectations, with a year-on-year growth of 7.6% when calculated at constant exchange rates [1] Group 1: Sales Performance - Retail sales for the Prada and Miu Miu brands were in line with market expectations, showing a year-on-year decrease of 0.8% for Prada and a year-on-year increase of 29% for Miu Miu [1] - The Chinese market for the Prada core brand still experienced negative growth, but there was a quarter-on-quarter improvement in the third quarter [1] - Positive growth was achieved in the Americas, Europe, and Japan, driven by strong local demand and a slight improvement in tourism demand, leading to quarter-on-quarter improvements [1] Group 2: Management Outlook - Management believes that the worst period for the Chinese market has passed [1] Group 3: Valuation and Rating - Credit Lyonnais maintains a "Outperform" rating for Prada with a target price of HKD 50, citing the company's ongoing market share expansion [1] - The valuation is considered low at 26 times enterprise value/EBITDA, representing a 53% discount compared to the industry average [1]

Core Insights - LVMH and Kering both experienced significant stock price increases following their Q3 earnings reports, indicating positive market sentiment towards the luxury goods sector [1][2][3] Financial Performance - LVMH's quarterly revenue growth rates were -3%, -4%, and 1% for Q1 to Q3, showing a shift from negative to positive growth in Q3 [4] - Kering's revenue growth rates were -14%, -15%, and -5%, with a notable reduction in the decline during Q3 compared to previous quarters [4] - Prada maintained stable growth rates of 13%, 8%, and 8% across the same quarters [4] - Hermès showed consistent growth with rates of 7%, 9%, and 10%, indicating a steady upward trend [5] - Overall, all four luxury brands reported strong performance in Q3, with most showing improved year-over-year growth compared to the previous two quarters [6] Regional Sales Analysis - LVMH saw improved revenue growth in all regions except Europe, with the U.S. and Asia (excluding Japan) achieving positive growth rates of 3% and 2% respectively [7] - Kering reported a positive turnaround in North America with a 3% growth rate, while the Asia-Pacific region (excluding Japan) saw a significant narrowing of decline by 9 percentage points [7] - Prada's retail sales in the Asia-Pacific region (excluding Japan) grew by 10%, while the Americas experienced a 14.8% increase in retail sales [7] - Hermès reported growth across all regions, with North America leading at 14% [8] Market Trends and Influences - The luxury goods market is showing signs of recovery, particularly in North America, attributed to a strong high-net-worth consumer base and their resilience to economic cycles [10] - There is a notable correlation between luxury spending and stock market performance, with an 87% correlation between luxury demand and the S&P 500 index [10] - The U.S. stock market's performance has positively impacted the wealth of high-net-worth individuals, thereby boosting luxury consumption [11] Chinese Market Dynamics - The Chinese luxury market is showing signs of improvement, influenced by currency fluctuations that have affected consumer behavior [12] - The depreciation of the yen made luxury goods in Japan cheaper for foreign tourists, leading to a temporary decline in Chinese luxury spending abroad [12] - As the yen strengthens, some consumer demand is returning to the Chinese market, although the overall recovery remains limited [12] Future Outlook - The significant improvements in Q3 for LVMH and Kering, particularly in North America and the narrowing of declines in Asia, suggest a potential turning point for the luxury goods sector [13] - The sustainability of this recovery will depend on performance in Q4, as both companies face high base comparisons from the previous year [13]

Core Viewpoint - The financial reports of LVMH and Kering indicate a significant recovery in the luxury goods sector, as evidenced by improved year-on-year revenue growth in Q3 compared to the previous two quarters [1][9]. Group 1: Company Performance - LVMH's quarterly revenue growth rates were -3%, -4%, and 1%, showing a positive shift in Q3 [1]. - Kering's revenue growth rates were -14%, -15%, and -5%, with a notable reduction in the decline in Q3 [1]. - Prada maintained stable revenue growth rates of 13%, 8%, and 8% across the quarters [2]. - Hermès showed increasing revenue growth rates of 7%, 9%, and 10% in the same period [3]. Group 2: Regional Sales Performance - LVMH saw improved revenue growth in all regions except Europe, with the U.S. and Asia (excluding Japan) achieving positive growth rates of 3% and 2%, respectively [4]. - Kering reported a significant recovery in North America, with a positive growth rate of 3% in Q3, while the Asia-Pacific region (excluding Japan) saw a 10% decline, which was a substantial improvement [5]. - Prada's retail sales in the Asia-Pacific region (excluding Japan) grew by 10%, while the Americas saw a 14.8% increase in retail sales [4][5]. - Hermès experienced revenue growth across all regions, with North America leading at 14% [5]. Group 3: Market Trends and Influences - The luxury goods market's recovery is significantly influenced by the performance of the U.S. stock market, which has a strong correlation with luxury spending [6][7]. - The increase in wealth among high-net-worth individuals in the U.S. has contributed to the growth in luxury goods consumption [6]. - The depreciation of the Japanese yen has attracted foreign tourists to Japan, boosting luxury sales there, although this trend is expected to reverse as the yen strengthens [7][8]. Group 4: Future Outlook - The sustainability of the recovery in the luxury sector will depend on whether the positive trends in Q3 can continue into Q4, as companies face high base effects from the previous year [11].

Core Insights - The ultra-luxury resale market is undergoing a significant transformation, shifting from mere shopping choices to platforms for personal narrative and smart investment [2][6][15] - Consumers are increasingly viewing second-hand luxury items as a means to express individuality and resist mass production, while also serving as a hedge against inflation [6][15] - The report highlights generational differences in consumer preferences, with Gen Z favoring top-tier brands like Hermès, while Millennials remain loyal to classic brands such as Louis Vuitton and Chanel [9] Market Trends - The ultra-luxury second-hand market is redefining luxury consumption, emphasizing long-lasting value and personal expression over fleeting trends [2][3][6] - Goyard has emerged as a standout brand, with a 400% increase in search volume, indicating a shift in consumer interest towards unique designs [11] - The rise of "tactile economy" is evident, with increased demand for materials like denim, suede, and metallic finishes, reflecting consumers' desire for multi-dimensional sensory experiences [11] Future Outlook - Authenticity is projected to become the ultimate pursuit in luxury goods, with a focus on humanized expression and deeper personal connections with fashion items by 2026 [13] - The ultra-luxury second-hand market is positioned as an innovative platform that transcends traditional fashion industry boundaries, driven by narrative value and investment attributes [15]

Core Insights - Ralph Lauren's new product, a "cowhide leather firewood tote" priced at 5,390 yuan, has sparked widespread discussion due to its unique design and practical use [3] - The product is part of the limited edition fall collection for 2025, launched on September 3, and is made from coarse cowhide leather sourced from Ralph Lauren's ranch in the U.S. [3] Financial Performance - Ralph Lauren reported a 14% year-over-year increase in net revenue for Q1 of fiscal year 2026, reaching over $1.7 billion [6] - Net profit attributable to shareholders rose by 30.7% to $220 million [6] - The company opened 24 new self-operated and partnership stores during the first quarter [7] Regional Growth - Revenue growth was led by Asia and Europe, both achieving double-digit increases, with Asia's total revenue growing by 21% to $474 million [7] - North America saw an 8% growth in revenue [7] - In China, Ralph Lauren experienced over 30% year-over-year growth in the first quarter, highlighted by the first fashion show in Shanghai and a flagship store opening on October 15 [7]

Core Viewpoint - The article discusses Europe's dependency on China's rare earth resources and the challenges it faces in attempting to regain control over its supply chain, highlighting the historical context and current geopolitical dynamics [1][2][4]. Group 1: Historical Context - In the late 20th century, European leaders decided to outsource the "dirty work" of rare earth mining and processing, believing it would allow them to focus on cleaner, high-tech industries [1][2]. - This decision led to a situation where China capitalized on the discarded resources, becoming the global leader in rare earth production and technology [2][4]. Group 2: Current Challenges - Europe is now facing a crisis as it realizes its heavy reliance on China for rare earth elements, which are essential for its green energy and advanced manufacturing sectors [2][4]. - The EU has introduced a "counter-coercion tool" to address economic pressures from China, but this tool has not yet proven effective in practice [4][6]. Group 3: Internal Conflicts - The EU's internal divisions pose a significant challenge; member states have conflicting interests regarding trade with China, particularly in industries like automotive and luxury goods [6][7]. - The proposed "self-reliance" initiative to develop local mining and manufacturing capabilities faces significant hurdles, including lengthy approval processes and high environmental standards [6][7]. Group 4: Long-term Outlook - The path to self-sufficiency in rare earth production is expected to be long, costly, and fraught with difficulties, making it unlikely that Europe can quickly resolve its current dependency on Chinese imports [7][9]. - The competition is not balanced; China holds advantages in resources, technology, and market access, while Europe struggles to find effective solutions to its supply chain issues [9][11].

Core Insights - Salvatore Ferragamo reported a consolidated revenue of €221 million for Q3 2025, remaining stable compared to the same period last year at current exchange rates [1] - For the first nine months of the year, the group's total revenue reached €695 million, reflecting a year-on-year decline of 6.6% [1] Regional Performance - The EMEA (Europe, Middle East, and Africa) region experienced a net sales increase of 2.8% in Q3 [1] - North America saw a significant growth of 15.6% in net sales [1] - In contrast, the Asia-Pacific region faced a decline of 10.5% [1] - The positive performance in North America, Europe, and Latin America offset the challenges in the Asian luxury goods market [1]

Core Insights - Bernard Arnault has been intensifying his efforts to strengthen control over LVMH, the luxury goods giant he founded nearly 40 years ago, with significant stock purchases in the past eight months totaling approximately €1.4 billion (around $1.6 billion) [1][2] - The recent stock acquisitions occurred during a period of weak corporate earnings and a downturn in the luxury goods sector, leading to a substantial decline in LVMH's stock price [1][2] - Arnault's stake in LVMH is a significant portion of his wealth, with a reported net worth of $195 billion and a 49% ownership of the company's equity, translating to nearly 65% of voting rights [1][2] Stock Acquisition Details - Arnault has acquired about 2.5 million shares of LVMH, representing approximately 0.5% of the company's total shares, through his family holding company Financière Agache and the publicly traded Christian Dior SE [2][5] - The average purchase price for these shares was around €566, with a notable low of €448 in June, while the stock closed at €612 last week [2][5] - The total amount of shares purchased as of mid-September is significantly higher than in previous years, coinciding with a recent unexpected recovery in sales reported by LVMH [2] Strategic Intent - Analysts suggest that Arnault's aggressive stock purchases may reflect a desire to achieve "absolute majority" control over LVMH, despite already holding nearly two-thirds of the voting rights [5] - The value of Arnault's investments outside of LVMH is relatively small, estimated at around €4 billion, indicating a strong focus on consolidating his position within the luxury sector [5] - Arnault has a history of strategic acquisitions, including a significant transaction in 2017 to simplify ownership structures, which aligns with his long-term vision for LVMH [6][7] Historical Context - The recent stock purchases echo Arnault's previous strategy during the 2008 financial crisis when he acquired LVMH shares at low prices, which later appreciated significantly [7]