Luxury brands of repute are all focused on the Asian region, particularly China as it represents the most important area of growth. Coach as brand completes seventy years of its existence this year and has created a respectable space for itself in accessories and gifts for women and men, including handbags, business cases, footwear and watches. Credit Suisse in its report on China said that Coach has made impressive strides in China and may hit the $1 billion mark in the next five years from a relatively modest $187 million this year.
Coach has adopted a multipronged approach in improving its presence in the China region. In order to raise its profile among China’s rich; Coach is planning a listing on the Hong Kong stock exchange through an issue of Hong Kong depositary receipts. They are not looking to raise funds through the listing exercise. J.P. Morgan Chase & Co., the financial consultants have been commissioned to handle the listing process. This is now growing into a trend for the luxury brands. Two major Italian brands Ferragamo and Prada took the IPO route earlier for Hong Kong listing.
In the month of June Prada SpA raised US$2.5 billion. In the same month the US luggage maker Samsonite International raised $1.25 billion. Brazilian mining giant Vale SA was the first company to obtain a listing by issuing depositary receipts in December 2010. There are several other resource companies that are listing in Hong Kong to forge closer links with resource hungry China. Coach is also hoping to make rapid growth in China.
Via: online.wsj
