Prada’s Hong Kong IPO reveals that luxury retail is alive and well

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Despite rumors that Hong Kong retail investors are nervous about grabbing too many shares of Prada and having to pay Italian taxes, institutional accounts are loving the space. While the Asian media are consumed with fretting over whether Prada's $2.6 billion IPO in Hong Kong will go sour, the company's roadshow in New York is on fire. The leather attache cases they are handing out to investors at the luncheons are reason enough to go. But the close-up look at Prada management has also led several major institutional players to firm up their bids on the company's shares. The book closes in New York at noon on June 16, but will stay open a little longer for Boston investors. At this point, reportedly, there are several times as many bids as shares available -- and the deal is expected to price at roughly the midpoint of its anticipated range, or roughly $5.45 a share. With that kind of demand on the table, it really might not matter whether Hong Kong individual investors worry about having to pay Italian capital gains and dividend taxes on this company. The institutions are big enough. And the luxury consumer segment is doing just fine, thank you. Look at Landrover International sales: booming and taking parent Tata Motors ( TTM , quote ) up with them: Tiffany ( TIF , quote ) sales are off the charts. Throw in names like Coach ( COH , quote ) and the high end is hot.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , International , Stocks

Referenced Stocks: COH , TIF , TTM

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