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CHINA LUXURY: BRAND BY BRAND

Unique, sophisticated, complex and competitive.

Those four words are what Rothschild & Co Redburn analyst Emily Cooledge uses to characterise the Chinese luxury market after a recent visit.

Europe's luxury stocks .STXLUXP have struggled at the start of 2026, down 11% year-to-date. Shares in French luxury giant LVMH plunged earlier this week as fourth quarter results dashed hopes of a speedy recovery in demand.

"From a market perspective, our view of a gradual return to positive, but slower growth rate than previously, was supported," Cooledge says after the China visit.

"There is no obvious and immediate relief to warrant a V-shape inflection or major macro-led upgrade cycle. However sentiment is plateauing and absolute demand remains large," Cooledge added.

Cooledge believes that luxury brands are at very different places in terms of tackling the Chinese consumer, which creates "significant intra-luxury share opportunity".

Here's Cooledge's view on each major brand:

**LVMH - strongly placed, utilising its extensive brand heritage and firepower to position the core Louis Vuitton and Dior brands well

**Hermes - continues to differentiate in the elevation of its offer

**Burberry - early in its strategy, but focused action on product is clear

**Kering - progression for the Kering equity is hard, with new Gucci product limited and stores quiet

**Prada - has many moving parts to navigate in a more discerning market context

**Moncler - product is strong and well positioned, but this feels understood

**Richemont - has strong brands and category, which supports duration, but in a highly competitive segment. Expectations are ambitious

(Samuel Indyk)

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