Oct 19, 2009
Richemont, Swatch up on Deutsche price target hike
Oct 19, 2009
ZURICH, Oct 19 (Reuters) - Shares in Swiss luxury goods group Richemont (CFR.VX) and watchmaker Swatch Group (UHR.VX) rose over 2 percent on Monday 19 October, outperforming the sector, after Deutsche Bank hiked its price targets for the two groups.
Baume & Mercier (Richemont group)
"Our analysis suggests that even if retail demand for watches is flat in 2010, production will have to rise by 1-5 percent to close the output gap accumulated over the last 12 months," said Deutsche Bank analyst Francesca Di Pasquantonio.
"Swatch and Richemont have the best brands and exposure to capitalise on this catch up," Di Pasquantonio said.
Deutsche Bank raised Swatch Group to buy from hold and its price target to 295.00 francs from 230.00, while it upped Richemont's price target to 35.00 francs from 28.00 francs.
Richemont traded 2.2 percent higher at 31.20 francs by 1249 GMT, while Swatch Group was up 2.4 percent at 265.50 francs, outperforming a 0.9 percent rise in the DJ personal and household goods index is trading some 1 percent firmer .SXQP.
Bain & Co also said on Monday 19 October the impact of the global recession had not been as severe on luxury goods as was expected six months ago and noted currency appreciation had boosted Asian spending power. (Reporting by Katie Reid; Editing by Rupert Winchester) Reuters Messaging rm://[email protected]
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