ECONOMY

Folli-Follie joint venture to open in China’s stores

Athens-listed jewelry retailer Folli-Follie said it had formed a joint venture with a Greek apparel retailer to sell clothing, jewelry and watches for children and babies in China. The jewelry retailer said late on Monday the Folli-Follie Baby joint venture with Lapin House will open three stores in Beijing and Shanghai next month. Folli-Follie plans to expand the brand in the rest of Asia through stand-alone shops and shops in department stores, it said. Folli-Follie sells jewelry, watches and accessories in 20 countries in Europe and Asia through more than 320 points of sales. It currently operates 62 points of sales in China, where spending on luxury goods remains strong. «With 21 percent of the Chinese population being below 14 years old, there is a large, still fragmented market which can be developed,» Folli-Follie said in statement. The stock trades at 13.4 times 2006 earnings compared to a P/E ratio of 25.3 for the European luxury goods sector, according to Reuters Estimates. Analysts attribute the discount to slower net profit growth. Yesterday, the firm said nine-month net profit rose 24.7 percent, boosted by a larger contribution from subsidiary Hellenic Duty Free Shops (HDFS). Earnings were in line with analysts’ forecasts. Folli, which sells jewelry, watches and accessories in Europe and Asia, said net profit rose to 52 million euros versus an average forecast of 52.26 million euros. (Reuters)