Booming luxury sales in Hong Kong thanks to Chinese visitors
Mainland tourists to Hong Kong rose about 33 percent at the start of this week’s Lunar New Year, providing a boost for the city’s retail sales and luxury companies such as Prada, Vuitton or Chanel. More than 381,000 tourists visited Hong Kong from mainland China during the first three days of the holiday, compared with about 287,000 in the same period last year, according to Bloomberg calculations from immigration department data.
“Mainland tourist consumption in Hong Kong has been picking up in the past couple of months,” Raymond Yeung, a Hong Kong-based senior economist at Australia & New Zealand Banking Group Ltd., said by telephone today. “If Hong Kong retail sales in January and February also show encouraging growth bolstered by mainland tourist spending, we can say we are on the right track of recovery.” Consumer spending tends to spike during the week-long festival, which began Feb. 10 this year.
The nine shopping malls operated by Sun Hung Kai Properties Ltd drew 2.75 million shoppings in the four-days ended yesterday, Fiona Chung, general manager at the company’s leasing department, said by e-mail. Total sales at those malls rose 24 percent to HK$180 million ($23.2 million) during the period from a year earlier, Chung said.
“This is a great start of the year, we saw both strong traffic and strong sales growth,” Dennis Lau, director of sales operations at Chow Sang Sang, said by telephone today. Lunar New Year sales at the company rose 10 percent from a year earlier over the first four days, he said.
“The number of mainland tourists in Hong Kong rose more than 30 percent over the Lunar New Year – that gives an encouraging momentum for consumer stocks to do well,” Steve Chow, a Hong Kong-based analyst at Kingsway SW Securities Ltd., said by telephone today. “The spending per visitor, however, may not be rising as much, especially among the luxury categories such as jewelery and high-end watches.”
Hong Kong’s retail sales rose 9.8 percent in 2012, slower than the 24.8 percent increase a year earlier, the city’s census and statistics department said in its website. Luxury sales recorded a 3.4 percent contraction in August, the first negative growth in about three years, before rebounding with 11 percent growth in December. January retail sales data will be released on March 4.