LVMH could buy major luxury retailers in India, including Hermes’s local joint venture partner
The unstoppable Bernard Arnault, owner of LVMH, world’s largest luxury conglomerate, set up earlier this year L CAPITAL, an investment fund with 640 million US dollars to spend in Asia. One of the first targets has been leading Indian jeweller Gitanjali Gems, which could, now be followed by Genesis Colors, local joint venture partner and exclusive distributor of Jimmy Choo, Canali, Bottega Veneta, Kenzo, Paul Smith, Roberto Cavalli. Another possible target frequently mentioned in local media is Khanna Specialty Retail company, which is also the local joint venture partner of French luxury brand HERMES.
Arnault’s move to buy out local luxury retailers is a strategic one which could have a major impact on opening up India’s luxury market, which, despite its huge potential has been lagging behind China or Brazil mainly because of local bureaucracy and corruption, high import taxes as well as a law for foreign brand to penetrate the Indian market solely through a joint venture company.