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Asia's Tiffany's outshines rivals

Thursday, December 08, 2011 - 02:19

Dec. 8 - Chow Tai Fook, the world's largest jewelery maker, is set to list in one of Hong Kong's top IPOs this year. The company is over twice the size of Western rival Tiffany & Co. Tessa Dunlop reports.

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This is the Tiffany's of Asia. Chow Tai Fook is a household name in China. And thanks to bulging wallets there it's now one of the biggest jewellery retailers in the world. You may not be able to afford the products on sale. This diamond ring will set you back a cool 3 million dollars. But from next week you'll get a chance to own a slice of the company. It's due to list in Hong Kong in an IPO that'll raise over 2 billion dollars. Billionaire philanthropist George Soros is reported to be one of the investors, with a 50 million dollar subscription. It's a risky time to list, with volatile markets and fears of a China slowdown. But market watchers are betting on China's insatiable appetite for luxury. Chow Tai Fook is the leader in a sector that's seen doubling to 28 billion dollars over the next 5 years. (SOUNDBITE) (English) MANAGING DIRECTOR OF CHINA MARKET RESEARCH GROUP, SHAUN REIN, SAYING: "I think Chow Tai fook is going to continue to grow very well in the next 5 years because the foreign jewelers have really not opened up and been aggressive enough and opening throughout the entire country." The company already has more than 1,400 retail outlets across China, making it over twice the size of western rival Tiffany's. And it plans to open another 500 shops within 5 years. (SOUNDBITE) (Mandarin) UNIDENTIFIED CHINESE CUSTOMER, SAYING: "The things they sell are adorable. I like buying them for myself, and giving them away as presents. They're really cute." Appealing to Chinese tastes, the shop features pure gold figurines, like this friendly baby dragon and others - sure to be a hit ahead of China's year of the dragon in 2012. And gifts for every occasion. Tea is served to all potential buyers. And bargaining is very much part of the experience - making the chain a blend of old and new China. (SOUNDBITE) (English) MANAGING DIRECTOR OF CHINA MARKET RESEARCH GROUP, SHAUN REIN, SAYING: "Just as Tiffany's is an aspiration buy for many Americans, Chow Tai Fook is an aspiration buy for many Chinese." And analysts say its dominance in gold jewellery gives it the edge over foreign rivals. Eugene Mak from Core Pacific - Yamaichi International. (SOUNDBITE) (English) RESEARCH ANALYST, CORE PACIFIC - YAMAICHI INTERNATIONAL, EUGENE MAK, SAYING: "We see Chow Tai Fook having a huge competitive advantage over its Western rivals such as Tiffanies and Cartier and other brands." (SOUNDBITE) (English) REUTERS REPORTER, TESSA DUNLOP, SAYING: Tai Fook means good luck in Chinese. And that's something the company is counting on in its upcoming IPO. Tessa Dunlop for Reuters.

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Asia's Tiffany's outshines rivals

Thursday, December 08, 2011 - 02:19