PARIS — China’s economic meltdown doesn’t seem to be affecting a core segment of affluent women, at least according to a survey by RBC Capital Markets. One of the study’s surprising conclusions: Chinese women plan to continue gobbling up designer handbags, with the richest of them trading up to elite brands like Hermès and Chanel.
The survey partially supports RBC’s upgrade of Hermès International to outperform, from sector perform.
The bank selected 303 Chinese women who intend to buy a handbag value at more than $750 in the next 12 months out of a total of 1,014 polled.
In a research report issued Thursday, luxury analyst Rogerio Fujimori noted that of women planning purchases, 70 percent cited brand reputation and design as the key factors in their choice, far eclipsing the importance of price or the shopping experience.
Responses suggested no “slippage” in willingness to pay top dollar for designer purses, with the “sweet spot” for handbags in China ranging from $1,600 to $2,350.
More than three-quarters of respondents said they prized recognizable designs, including logos, and cited the highest purchasing intent for Gucci, followed by Chanel, Prada, Louis Vuitton and Hermès.
Almost all of the respondents, aged between 25 and 65, said they owned at least one handbag costing more than $750, with 30 percent of them owning four or more.
RBC said it also factored Hermès’s strong business fundamentals and “resilient earnings momentum” into its upgrade of the stock.
The luxury firm’s operating profit advanced 20 percent in the first half to 748 million euros, or $835 million, beating analyst expectations by 2 percentage points, as reported.