LVMH (Moët Hennessy Louis Vuitton) became the first European company to hit $500 billion (€453 billion) in market capitalisation on Monday after its share price rose and the euro strengthened against the dollar, as the luxury sector continues to benefit from China’s reopening.
Shares in the Paris-listed company edged up 0.3 per cent against Friday’s close to €903.7, briefly achieving a market capitalisation of €454 billion. This was equivalent to $500.3 billion as the exchange rate hit 1.1019 to the dollar.
This marks the first time a European company has ever surpassed the figure, according to Bloomberg. The second and third-biggest companies on the benchmark European Stoxx 600 index are valued significantly lower than LVMH. Nestlé, the world’s largest food company, and Danish drugmaker Novo Nordisk have market capitalisations of €326 billion and €272 billion respectively.
Other luxury goods companies in the top 10 include the world’s largest beauty company L’Oréal and Hermès, with Christian Dior just behind.
LVMH is controlled by billionaire Bernard Arnault. France’s Stock Exchange, the Cac 40, has risen 17 per cent in the year to date as investors pile into luxury goods groups. Shares in LVMH, the world’s biggest luxury group, have outpaced the index, climbing 32.9 per cent so far this year.
L’Oréal’s stock has risen 31.1 per cent in the same period while shares in Hermès, the maker of the iconic Birkin bag, have jumped 39.4 per cent.
LVMH, which owns brands including Louis Vuitton, Dior and Moët and Chandon, posted a 17 per cent increase in revenue in its first-quarter results earlier this month after China’s luxury market began to rebound following the lifting of the country’s zero-Covid policy. The company did however report that the pace of sales growth in the US, the sector’s biggest market, had plateaued. – Copyright The Financial Times Limited 2023