LVMH, Kering Set for Luxury Sector Recovery in Asia
The luxury sector is set for a prolonged recovery, with Asia showing signs of stabilizing, potentially benefiting LVMH and Kering. The two luxury giants are poised to capitalize on an expected 'outbreak of creativity and novelties' in the segment.
Analysts have upgraded LVMH Moet Hennessy Louis Vuitton SE and Kering S.A. to 'Overweight', reflecting their optimism in the sector's prospects. The price target for LVMH has been increased to 635 euros, while Kering's target stands at 370 euros. Despite LVMH's share price-to-earnings ratio currently at 3.25, below its ten-year average, the company's future looks promising.
LVMH and Kering are expected to focus on the Asia-Pacific luxury segments, particularly in countries like China, Japan, and South Korea. Rising wealth and urbanization in these regions drive demand for international luxury brands. Key opportunities include women's luxury products, technology integration in luxury goods, sustainable and eco-friendly items, and enhanced personalization and online retail experiences. These strategies aim to distinguish the companies amid slow sector growth.
With the luxury sector expected to recover until 2026, LVMH and Kering are well-positioned to benefit from an upcoming wave of creativity and novelties. Their focus on the Asia-Pacific region and innovative strategies could drive growth and strengthen their market positions.
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