Having conquered Hollywood, Harry Winston Diamond (HWD) is rolling out its red carpet all the way to China. The luxury brand last weekend opened its first flagship there with a free-standing, 5,800 square-feet salon in Shanghai�s glitzy Xintiandi shopping district, with cameras popping and the stars of TV�s �Gossip Girl� in attendance.
China has become Asia�s biggest retail market for diamonds, so it makes sense for Harry Winston � which owns both the namesake jewelry brand and a 40% stake in the huge Diavik mine in Canada�s Northwest Territories � to try and serve China�s big spenders at home.
�Everything is different here,� says Frederic de Narp, who runs Harry Winston�s retail business. The average customer is 15-20 years younger, and these clients aren�t just knowledgeable about their rocks but quite willing to invest in diamonds as a store of value. �And they want everything � they want quality and they want size. Small is not fine here.�
Shares are off more than 20% from their 2011 peak and fetch more than 14 times projected earnings, below their median of 19.4 times over the past five years. Last month, Harry Winston reported that fiscal fourth-quarter sales had declined 14% in the luxury brand segment, but robust mining revenue helped lift the company�s overall profits 21%.
– Kopin Tan
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