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Prada shares soar 20 percent as firm returns to sales growth

Reuters  |  HONG KONG 

(Reuters) - Shares in surged 20 percent on Monday after the Italian maker said it had stemmed a slide in sales in the second half of 2017 and it expected to see growth continue this year.

Criticised as slow to respond to new trends, particularly for informal clothes and shoes, has seen profit fall since 2014 even as competitors such as and have boosted sales. Core profit dropped 7.3 percent last year to 588 million euros.

New products, estimated to be about 60 percent of its total offerings, as well as robust demand from Chinese consumers, had helped to pull the company out of a 'grey area', it said.

The Hong Kong-listed stock jumped to HK$40 in early Monday trade, its highest level since June 2015 and adding $2 billion to its market capitalisation.

Alessandra Cozzani, Prada's chief financial officer, said in a conference call on Friday that the firm had seen double digit organic sales growth in Greater in the second part of the year and the first month of 2018.

generates over 30 percent of revenue from Chinese consumers at home and abroad. It is seeking to burnish its brand in with a new residence project in for fashion shows and exhibitions, and is putting more effort into e-commerce, an area where it has lagged rivals.

is one of the few available to invest in which helped spur its dramatic gains on Monday, said Alex Wong, a in

"We are quite bullish on luxury segment overall, particularly when continues to lead the growth," he added.

(Reporting by and Donny Kwok; Editing by and Edwina Gibbs)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, March 12 2018. 10:40 IST