Louis Vuitton enters the list of World’s Top Firms, m-cap nears $500 billion

New Delhi (India), 14th April 2023: LVMH, the biggest business in Europe by market value, is currently among the top ten corporations worldwide. A 5% rise in the share price on Thursday after a first-quarter sales beat, giving the luxury powerhouse a 29% surge for the year.

This increased LVMH’s market valuation to $486 billion, briefly making it the 10th-largest corporation in the world, along with a rise in the euro versus the dollar. It would be the first European firm to reach that milestone if it were to surpass $500 billion.

Gilles Guibout, head of European equity strategies at AXA Investment Managers said, “This illustrates the rise of wealthy people across the world, of a polarised society.” He further said, “The luxury sector is therefore experiencing strong growth.”

A rising number of investors believe that LVMH and its French luxury rivals are to the European stock market what Big Tech has been to the US: powerful companies whose growth continues despite fluctuations in the state of the economy.

Over the previous ten years, shares of LVMH, Hermes International, and Kering have all experienced average annual returns of over 20%. At 8.3% annually, the Stoxx Europe 600 Index is far behind.

As in many previous years, China is the driving force behind this year’s gains in luxury goods. Chinese consumers are splurging on designer handbags and jewellery after emerging from the toughest lockdowns in the world. The explosive growth of LVMH’s revenues demonstrates that even as a worldwide economic slump approaches, demand for expensive items is still strong.

The surge in luxury stocks has elevated Paris over London as the largest stock market in Europe. With gains of more than 15% this year, the benchmark CAC 40 Index is on a record-breaking tear, surpassing other significant markets.