LAOPU GOLD Declines 3.5% Following Announcement of $2.7B Fundraising via 4.5% Discounted Share Placement
Stock Performance: LAOPU GOLD (06181.HK) experienced a 7.888% drop, opening 3.52% lower at HKD740, with short selling amounting to $50.89 million and a ratio of 3.938%.
Share Placement Announcement: The company announced a 4.5% discounted placement of 3.7118 million new H shares at HKD732.49 each, aiming to raise approximately HKD2.707 billion.
Use of Proceeds: The funds from the share placement will be allocated as follows: 70% for inventory reserves, 10% for boutique expansion and optimization, and 20% for working capital and general corporate purposes.
Market Context: UBS noted that the gold trade is not "extremely crowded," suggesting ongoing demand for gold asset allocation due to factors like de-dollarization and debasement.
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Market Outlook for LAOPU GOLD: A survey indicates that LAOPU GOLD is expected to maintain its triple-digit growth despite a recent pullback in gold prices, with limited impact on sales according to Citi's research report.
Competitive Landscape: The high-end gold jewelry market is expanding rapidly, which restricts the ability of new entrants to compete with LAOPU GOLD.
Analyst Recommendations: Citi has identified LAOPU GOLD as a top pick in China's jewelry sector, assigning a target price of HKD1,119 and a Buy rating.
Short Selling Data: As of February 3, 2026, LAOPU GOLD has a short selling amount of $77.18 million, with a ratio of 11.790%.

Gold Jewelry Consumption Outlook: BOCI predicts that gold jewelry consumption will remain strong in the first quarter of 2026, despite recent fluctuations in gold prices.
Winners in the Market: High-end retailers like LAOPU GOLD are expected to thrive due to their ability to support high premiums, alongside retailers with a strong presence in Hong Kong and Macau.
Top Industry Pick: BOCI has identified LUK FOOK HOLD as its top pick in the industry and has raised its target price to HKD 35.9.
Market Sentiment on Gold Prices: G Sachs views the current gold price as uncertain, projecting a year-end price of USD 5,400, while also noting potential volatility in silver prices.

Positive Growth for LAOPU GOLD: The Hurun Chinese Luxury Consumer Survey indicates that LAOPU GOLD has risen from 8th to 3rd place among favorite jewelry brands for high-net-worth individuals in China, despite a contraction in the luxury market.
Citi's Favorable Outlook: Citi research highlights LAOPU GOLD as a top pick in the Chinese jewelry industry, citing the growing preference for gold collectibles among high-net-worth consumers and a target price of HKD1,119 with a Buy rating.

China's Jewelry Market Growth: Goldman Sachs forecasts a slowdown in China's jewelry market growth to 4% in 2026, down from approximately 10% in 2025, due to high base effects and unstable consumption power, maintaining a Neutral outlook for the sector.
Gold Price Predictions: The broker anticipates gold prices will reach USD 5,400 per ounce by the end of 2026, representing a 25% year-over-year increase, with demand supported by rising prices but facing challenges in product margins and sales consumption.
Market Performance: The jewelry sector's stock prices have outperformed the Hang Seng Index (HSI), indicating a strong market performance despite the anticipated slowdown in growth.
Investment Recommendations: Goldman Sachs has a Buy rating on LAOPU GOLD (06181.HK), citing growth opportunities and setting a target price of HKD 1,128, despite current short selling pressures.

Revenue Growth Prediction: CMSI forecasts that LAOPU GOLD will experience a significant slowdown in revenue growth, dropping from 220% in 2025 to approximately 30% in 2026.
Marketing Strategy Concerns: The company's current revenue is largely driven by FOMO marketing tactics rather than genuine sales growth, which raises concerns about its sustainability compared to true luxury brands.
Deteriorating Earnings Quality: The report indicates a decline in LAOPU GOLD's earnings quality, with a conservative store expansion plan focusing more on efficiency than growth, limiting its market presence.
Investment Rating and Target Price: CMSI has assigned an Underweight rating to LAOPU GOLD, setting a target price of HKD825.5 for the stock.

Revenue Growth Prediction: Haitong International forecasts LAOPU GOLD's revenue will increase by 217% YoY to RMB26.96 billion in 2025, with a significant rise expected in the second half of the year.
Business Performance Insights: The report indicates that LAOPU GOLD is experiencing faster growth in online sales compared to offline, and its international market expansion is surpassing domestic growth.
Stock Rating and Target Price: Haitong International maintains an Outperform rating for LAOPU GOLD, setting a target price of HKD948.4.
Market Context: The report also references a related analysis from M Stanley, suggesting that gold prices have not peaked and could potentially reach USD5,700 in the second half of the year.





