Laopu Gold’s jewellery is selling like hot cakes despite tepid consumer spending in China

By Investor Empires On Feb 10, 2025

Lubo GoldA jeweler appeared in Beijing, known for his manual accessories, as a favorite The wealthy consumersWhere luxury global brands such as Louis Vuitton and Gucci are wrestling with lukewarm consumer spending in China and slow sales throughout the region.

With only 36 stores in Greater China, the company listed in the Hong Kong list sold 3.5 billion yuan (482.7 million US dollars) of gold and fundamental jewelry in the first half of 2024, an increase of 148 percent over the previous year, according to what I said a year ago One, according to its temporary report. The net profit increased to nearly 200 percent to 588 million yuan during the same period.

Laopu Gold shares have risen by more than 550 percent since the company’s circulating company appeared, reaching its highest level Hong Kong ($ 58.7) on Tuesday.

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With the rise in gold prices Nearly a year ago and the remaining consumer morales were subjected to the slowdown of China, the demand for gold jewelry decreased in the collective market. Richard Lin, chief consumer analyst at SPDB International, said that the performance of LAOPU is “completely different”, because it “fully focuses on the high -end market.”

He said: “The wealthy consumers are not only affected by the broader economic conditions, but more importantly, unlike the normal consumer who buys gold as an appendix or for consumption, they also consider the investment value of golden products.”

LaPU’s success is partly attributed to its pricing model. Unlike the competitor Chao Tae Fook Jewelry – Which sells the largest part of its gold accessories based on a dynamic pricing model that rises and falls with the yellow metal – LAOPU follows the “fixed price” model, where the prices remain unchanged even though it involves a huge mark to reflect the complex company of the craftsman.

For laop, this means more profit. According to its temporary report, the company’s total margin was 41.3 percent in the first half of 2024, compared to about 20 percent of Chow Tai Fook.

“With the price of gold now about 600 yuan (82.30 USD) per gram and is likely to continue to rise, many consumers think, as we have to pay more brand and craftsmanship anyway, and we may also choose Laopu due to the quality of its products.” Lynn said. “This is mainly related to the brand’s authority.”

Lubo’s attractiveness is also associated with young people and the wealthy to promote it to “Heritage Gold” – a type of pure gold jewelry that mixes old formulation techniques with Chinese culture and design elements inspired by Buddhist faith.

Sheila Zhang, a financial specialist based in Beijing, bought a prayer wheel necklace costing about 20,000 yuan in January. She said her first impression on Lubo was “it is completely different from other brands.”

Shopping at an outdoor commercial center in Beijing. Photo: AP alt = shoppers at an outdoor commercial center in Beijing. Photo: AP>

The store I visited in WangFujing, a commercial area in the city center, offers two main categories of jewelry: one that includes Chinese and traditional Taous accessories, and another focuses on Buddhism.

She said: “In general, Laopu is very simple and clear in its offers, which, compared to other brands that overcame the options, makes it easy to make a decision.” “I loved it so much, because its style is very unique.”

Zhang is not the only person who feels this way. In Rednote, the Chinese social media application that recently rose to international fame due to the US campaign on Tiktok, there were more than 1.2 million jobs that included the “Laopu Gold” retail. These publications are complex brilliantly for the necklaces and rings of the jewelery, as well as videos of long waiting lists outside their stores.

“I love this brand. I have to work hard to earn more money,” wrote a Rednote user named Yoyo Zaizai, who published a picture of herself in a golden necklace. “It is very beautiful. Once you start buying laop, you cannot escape from the” hole “.

With the rise in the price of gold at the highest level ever this week, which was ignited by the demand for the safe armed assets amid the unrest raised by the American tariff, LaPu Gold will benefit. The company’s net profit in October in October is expected to reach 1.7 billion yuan in 2025, adding that in 2026, it may reach 2.3 billion yuan.

But negative risks waved on the horizon. As the company’s shares rise with the rise in gold prices, LaPU may lose its interest among consumers when gold prices begin to decrease.

“When this happens, the question is whether the strength of the Laopu brand can compensate for some of the negative effect of the gold prices.” “It is a possibility.”

This article was originally appeared in Southern China Mooring Post (SCMP)The most reliable reports on China and Asia for more than a century. For more SCMP stories, please explore SCMP app Or visit scm’s Facebook and twitter Pages. Publishing Rights © 2025 South China Morning Post Publishers Ltd. All rights reserved.