Editor’s Note
This article examines shifting dynamics in the global jewelry market, contrasting the resilience of established giants like Richemont with the disruptive rise of Chinese brands championing “China-Chic” aesthetics.
Brands like Cartier give Richemont resilience during the luxury downturn. But for how long? A young company from China is causing a stir.
Customers of Laopu Gold in Hangzhou: The rush for the company’s jewelry has caused its stock to rise by 172 percent since the beginning of the year alone.
Richemont shareholders have every reason to be satisfied. Whether over a five-year period, in the last twelve months, or since the beginning of the year – their investments are among the best in the luxury sector. Despite the great luxury paralysis, Richemont’s valuations have remained stable this year, while the competition has partly lost significant value. Kering is down 7.9 percent, Hermès 8.3 percent, the Swatch Group 11.9 percent, and giant LVMH a hefty 23.1 percent.
The reason is simple. Among the major luxury goods players, no one is stronger in the jewelry business than Richemont. And the jewelry business, in turn, is traditionally the most resilient segment in luxury. Richemont owns the mega-brand Cartier – and the also large and important brand Van Cleef & Arpels (VCA). Only LVMH, with the brands Bulgari and Tiffany, can somewhat keep up. All others are far behind. In other words: Richemont is Cartier and VCA. And that’s why it’s strong. But the big question is: For how much longer?