LVMH Moët Hennessy - Louis Vuitton, Société Européenne

LVMH Moët Hennessy Louis Vuitton

Headquarters in Paris
Trade name	LVMH
Type	Public (Societas Europaea)
Traded as	Euronext Paris: MC CAC 40 Component
ISIN	[https://stockhub.co/index.php?title=Toollabs:isin/&language=en&isin=FR0000121014 FR0000121014]
Industry	Luxury goods
Predecessors	Moët & Chandon Hennessy Louis Vuitton
Founded	3 June 1987 (1987-06-03)
Founders	Bernard Arnault Alain Chevalier Henry Racamier
Headquarters	Global: 22 Avenue Montaigne Paris, France Overseas: LVMH Tower 19 East 57th Street New York, N.Y., U.S.
Number of locations	5,664 stores (2022)
Area served	Worldwide
Key people	Bernard Arnault (chairman and CEO) Delphine Arnault (director) Antonio Belloni (MD, Deputy CEO) Andrew Lovell (MD)
Products	Clothing cosmetics fashion accessories jewelry perfumes spirits watches wines
Services	Department stores
Revenue	€79.2 billion (2022)
Operating income	€21.1 billion (2022)
Net income	€14.1 billion (2022)
Total assets	€135 billion (2022)
Total equity	€56.6 billion (2022)
Number of employees	196,006 (2022)
Parent	Christian Dior SE (41.1%)
Subsidiaries	List of subsidiaries
Website	lvmh.com

Business Description

LVMH Moët Hennessy - Louis Vuitton, Société Européenne operates as a luxury goods company worldwide. The company offers champagnes, wines, and spirits under the Clos des Lambrays, Château d'Yquem, Dom Pérignon, Ruinart, Moët & Chandon, Hennessy, Veuve Clicquot, Ardbeg, Château Cheval Blanc, Glenmorangie, Krug, Mercier, Chandon, Cape Mentelle, Newton Vineyard, Cloudy Bay, Belvedere, Terrazas de los Andes, Bodega Numanthia, Cheval des Andes, Woodinville, Ao Yun, Clos19, and Volcan de mi Tierra brands.

It also provides fashion and leather products under the Berluti, Celine, Christian Dior, Emilio Pucci, FENDI, Givenchy, Kenzo, Loewe, Loro Piana, Louis Vuitton, Marc Jacobs, Moynat, Patou, and RIMOWA brands.

In addition, the company offers perfumes and cosmetics under the Acqua di Parma, Benefit Cosmetics, Cha Ling, Fenty Beauty by Rihanna, Fresh, Givenchy Parfums, Guerlain, KVD Beauty, Kenzo Parfums, Maison Francis Kurkdjian, Make Up For Ever, Marc Jacobs Beauty, Officine Universelle Buly, Parfums Christian Dior, and Perfumes Loewe brands.

Watches and jewelry under the Bulgari, Chaumet, Fred, Hublot, Repossi, TAG Heuer, Tiffany & Co., and Zenith brands; and custom-designed yachts under the Feadship brand name, as well as designs and builds luxury yachts under the Royal Van Lent brand. Further, it provides daily newspapers under the Les Échos brand; Belmond, a luxury tourism service; home other activities under the Belmond, Cheval Blanc, Connaissance des Arts, Cova, Investir, Jardin d'Acclimatation, La Samaritaine, Le Parisien, and Radio Classique brands.

Selective retailing products under the DFS, La Grande Epicerie de Paris, Le Bon Marché Rive Gauche, Sephora, and Starboard Cruise Services brands, as well as operates Jardin d'Acclimatation, a leisure and amusement park.

Summary

LVMH Moët Hennessy - Louis Vuitton was founded in 1987 and is headquartered in Paris, France.

Today, the group is made up of more than 75 Maisons, with each one creating high quality products, but with their distinctive identities. The Maisons have carefully preserved their heritage by ensuring that the quality of their products is maintained and improved. To achieve products excellence over time vertical integration across the value chain is used, from sourcing the finest raw materials, production and selective retailing. The group will carry on pursuing its brand development-focused strategy in 2023.

The company operates 5,556 stores world wide and currently employs over 196,000 people.

It is the only group present in all five major sectors of the luxury market: Wines & Spirits, Fashion & Leather Goods, Perfumes & Cosmetics, Watches & Jewelry and Selective Retailing.

What's the mission of the company?

“Our success is only worthwhile if it is also virtuous. Success can only last if it is fair. And if it benefits everyone, then it will be even greater. What’s the point of inspiring dreams with magnificent products if they don’t meet the highest social and environmental standards? We apply those standards for the benefit of our employees and our customers of course, for our stakeholders as well, but above all for our future.” Bernard Arnault

2023 Objectives to further increase LVMH's global leadership position:

1. Confidence: continue growth momentum of the company and increase their desirability.
2. Creativity and excellence: focus on creativity, distribution and quality of our products with their core values always in mind.
3. Digitalisation: enrich customer's experience online and in stores.
4. Commitment: preserve the environment and corporate responsibilities.
5. Vigilance: maintain vigilance within current economic and geopolitical context.
6. Entrepreneurial spirit

Macro Analysis and Trends

LVMH operates in the luxury goods industry. This industry is characterized by high-end products that are often handmade and of the highest quality. Luxury goods are typically associated with status and exclusivity, and they are often seen as a way to express one's personal style.

The luxury goods industry is a global industry, with markets in all major regions of the world. The largest players are LVMH, Kering (which includes brands such as Bottega Veneta, Gucci, Saint Laurent), Richemont, Chanel, Burberry, Hermès, Moncler, and Prada.

The luxury goods industry is linked to macroeconomic factors such as economic growth, exchange rates, inflation, interest rates, political stability, and technological progress. Typically, growing economies, favourable exchange rates, low interest rates, and political stability positively impact the luxury sector.

However, the luxury goods industry has shown resilience in periods of economic downturns, and it is expected to deliver sustained growth in 2023, as high inflation and interest rates have a weaker impact on wealthy shoppers’ behaviour. To protect their image, luxury brand manufacturers favour high inventory levels over offering discounts. So far, inelastic demand has allowed them to pass on higher costs to customers, thus increasing their margins.

The industry has experienced significant growth in recent years, and it is expected to continue to grow in the coming years. Looking ahead, this growth will be driven by a number of macro trends:

1.      The growth of the middle class in emerging markets: The growth of the middle class in emerging markets is one of the most important trends in the global economy. By 2030 the global middle class, is expected to reach 4.8 billion people, that is 1.3 billion more people with increased purchasing power than today. This trend is driving demand for luxury goods in emerging markets. Despite a disappointing first half of 2023, due to a stall in US sales growth. Jean-Jacques Guiony, CFO, has stated that the stall in US sales is due to favourable currency exchange rates, American tourists travelled to Europe to make their purchases. This can be explained as Europe advances 28% in Q4-2022, with market share reaching 24% up from 21% in 2021. China still represents the largest emerging market for luxury goods and Asia's economy rebounded in Q1-2023 where sales grew 14%, compared to a falling 8% in the last 3 months on 2022.

2.      Generational trends: Millennials are increasingly becoming the target market for luxury goods brands. This is because millennials have more disposable income than previous generations, and they are more likely to spend money on luxury goods. Additionally, “Gen Z” are expected to represent one-third of the market by 2030 and their spending is set to grow three times faster than for other generations until 2030.

3.      The growth of online shopping: The growth of online shopping is another important trend that is impacting the luxury goods industry. Online shopping is making it easier for consumers to buy luxury goods from around the world. This trend was observed during the Covid- 19 global pandemic, due to the closure of retail stores.

4.      The demand for sustainable luxury goods: There is a growing demand for sustainable luxury goods. This is because consumers are becoming more aware of the environmental impact of luxury goods production. Even though, according to Bain-Altagamma, the luxury market is only expected to grow 3% to 5% or 6% to 8%, best case scenario, in 2023.

Key Professionals

Name	Title	Brief Desciption
Arnault, Bernard	Chairman & CEO	Mr. Bernard Arnault is a prominent figure in the luxury industry and serves as the Executive Chairman and Chief Executive Officer of LVMH Moët Hennessy Louis Vuitton. He has been with the company since January 1989. Mr. Arnault began his career as an engineer and later became Chairman and CEO of Ferret-Savinel. He then led a reorganization of Financière Agache and Christian Dior, focusing on luxury brands.Mr. Arnault is also the Chairman of Christian Dior SE and serves as the Chairman of Groupe Arnault SAS and Montaigne Participations et Gestion SA. He has directorship positions in various companies, including LVMH Moet Hennessy Louis Vuitton SA, Financiere Jean Goujon, Christian Dior Couture, and Societe Civile du Cheval Blanc. He is actively involved in the luxury industry and owns Chateau Cheval Blanc SA. Outside of LVMH, Mr. Arnault has served as a Director of companies such as Diageo plc and Vivendi Société Anonyme. He has been recognized for his business acumen and leadership, holding positions in organizations like Paris EUROPLACE and Frere-Bourgeois. Mr. Arnault's influence extends internationally, as he serves on the Director boards of LVMH subsidiaries in the United States and Japan. He holds the position of Chairman of the Executive Board at Groupe Arnault SEDCS and is the Chairman of Louis Vuitton, Fondation d’Entreprise.
Guiony, Jean-Jacques	Chief Financial Officer	Mr. Jean-Jacques Guiony holds multiple executive positions within the LVMH group and its subsidiaries. He serves as the President and Managing Director of Delphine SAS, L Real Estate Advisors (France), LVMH Hotel Management, SOFIDIV, and UFIPAR. Mr. Guiony is also the President of Lvmh Inc. and Marc Jacobs Holdings, LLC. Since 2004, Mr. Guiony has been the Chief Financial Officer of LVMH Moët Hennessy - Louis Vuitton. He is also the Chief Executive Officer and President of GRANDS MAGASINS DE LA SAMARITAINE MAISON ERNEST COGNACQ S.A. Prior to joining LVMH, he served as the Head of Mergers & Acquisitions at Lazard Ltd. Mr. Guiony holds various directorship positions in numerous companies, including Belmond Ltd. He also serves as the Chairman of several entities such as GRANDS MAGASINS DE LA SAMARITAINE MAISON ERNEST COGNACQ S.A., Creare Pte Ltd., LA Samaritaine, LBD Holding, LVMH Iberia SL, LVMH Finance, and LVMH Iberia SL. Additionally, he serves as a Member of the Supervisory Board of Berluti, LES Echos, and RVL Holding BV, representing LV Group. Mr. Guiony holds directorship positions in companies such as Ashbury Finance SA, Bulgari S.P.A, DFS Group Limited, and Louis Vuitton Malletier, among others, on behalf of LVMH entities. Mr. Guiony is a graduate of Groupe HEC, a prestigious business school in France. His extensive involvement and leadership roles within LVMH and its subsidiaries highlight his significant contributions to the luxury conglomerate.
Kuhn, Bernard	General Counsel	Bernard Kuhn serves as General Counsel of LVMH Moët Hennessy - Louis Vuitton, Société Européenne (formerly known as LVMH Moët Hennessy Louis Vuitton SE)-
Bouillonnec, Yann	Vice President of Sales	Yann Bouillonnec serves as Managing Director of Asia Pacific at Vacheron & Constantin SA. Yann Bouillonnec serves as Vice President of Sales at LVMH Moët Hennessy - Louis Vuitton, Société Européenne.-
Gaemperle, Chantal	Group Executive Vice President of Human Resources & Synergies	Mrs. Chantal Gaemperle is the Group Executive Vice President of Human Resources and Synergies at LVMH Moët Hennessy - Louis Vuitton. She has held this position since January 2007. Prior to joining LVMH, Mrs. Gaemperle served as the Head of Corporate Management Development and Sourcing at Nestlé from 2001. With a background in human resources, Mrs. Gaemperle previously worked as the Director of Human Resources for LVMH. She began her career at Philip Morris and later joined Merrill Lynch as the Director of Human Resources for Switzerland. Mrs. Gaemperle holds a Master's degree in Political and Social Sciences, as well as an MBA in Public Administration from the University of Lausanne. She is also a graduate of INSEAD, a prominent business school in France. In her role at LVMH, Mrs. Gaemperle oversees the human resources function and works on implementing synergies within the group. Her extensive experience and educational background contribute to her strategic management of human resources within the luxury conglomerate.
Arnault, Antoine	Group Chief Image & Environment Officer and Director	Mr. Antoine Arnault holds several key positions within the luxury conglomerate LVMH Moët Hennessy Louis Vuitton and its subsidiary Christian Dior. Since December 2022, he has served as the Chief Executive Officer and Vice-Chairman at Christian Dior. Additionally, he has been the Managing Director of Berluti since 2011 and serves as the Chairman of the Executive Board at Berluti SA. Mr. Arnault is also the Chairman and Chief Executive Officer at LV Group SA. He holds the position of Managing Director at Berluti LLC (United States) and France Marbeuf Capital SARL. Since 2013, he has been the Chairman of the Board at Loro Piana SpA (Italy). Furthermore, Mr. Arnault is a Member of the Executive Board at France Groupe Arnault SEDCS. Having joined LVMH in 2007, Mr. Arnault previously served as the Director of Communication at Louis Vuitton. He has also held various roles within Louis Vuitton, including Marketing Manager and Director of Provincial Operations in France. Currently, he serves as a Director of LVMH Moët Hennessy Louis Vuitton SA and holds the position of Group Chief Image & Environment Officer. Outside of LVMH, Mr. Arnault has been involved in several directorial and advisory roles. He was an Independent Director of Lagardere SCA until October 2013 and is a Member of the Supervisory Board at Les Echos SAS. He serves as a Director of various companies, including Berluti Hong Kong Company Limited, Berluti (Shanghai) Company Limited, Fendi Srl, and Comité Colbert. Mr. Antoine Arnault's extensive experience and multiple leadership roles within LVMH and its subsidiaries demonstrate his significant contributions to the luxury industry and the strategic management of these renowned brands.
Arnault, Frederic	Chief Executive Officer of TAG Heuer	Mr. Frederic Arnault has been the Chief Executive Officer of TAG Heuer at LVMH Moët Hennessy - Louis Vuitton, Société Européenne since July 1, 2020. Mr. Arnault had been a Strategy and Digital Director of TAG Heuer at LVMH Moët Hennessy Louis Vuitton SE since September 2018.-
Bazire, Nicolas	Senior VP of Development & Acquisitions and Director	Mr. Nicolas Bazire has held several significant positions within the luxury conglomerate LVMH Moët Hennessy Louis Vuitton and Groupe Arnault SAS. Since 1999, he has served as the Chief Executive Officer and Managing Director of Groupe Arnault SAS. Additionally, he is the Senior Vice President of Development and Acquisitions at LVMH. Mr. Bazire has a diverse professional background. He was previously the Managing Partner of Rothschild & Cie Banque and served as its Chief Executive Officer and Chairman of the Partnership Board. He has also held positions at the Cour des Comptes as an Auditor and auxiliary judge. From 1993 to 1995, he worked as the Chief of Staff and a Project Manager for Prime Minister Edouard Balladur. As for his directorial roles, Mr. Bazire has served on the board of various prestigious companies. He has been a Director of LVMH Moët Hennessy Louis Vuitton since 1999 and Christian Dior SE since 2017. He was a Non-Independent Director of Carrefour SA from 2008 to 2021 and a Director of SUEZ SA from 2008 to 2020. Mr. Bazire is involved in numerous directorial and managerial roles within Groupe Arnault and its affiliated companies. He serves as a Vice-Chairman of the Supervisory Board at Les Echos SA and a Director of Louis Vuitton Malletier SA, LV Group SA, and Louis Vuitton, Fondation d'Entreprise. He is also a Director of LVMH Fashion Group, Louis Vuitton pour la création, and other entities.
Beaufils, Benjamin	President of North American Operations	Mr. Benjamin Beaufils serves as President of North American Operations at LVMH Moët Hennessy - Louis Vuitton, Société Européenne since September 2019. Mr. Beaufils was the former head of the Louis Vuitton brand's North American arm.-
Belloni, Antonio	Group MD & Director	Mr. Antonio Belloni, also known as Toni, is the Group Managing Director of LVMH Moët Hennessy Louis Vuitton, Société Européenne (LVMH) since September 2001. He joined the LVMH group in June 2001, bringing with him experience from Procter & Gamble. At Procter & Gamble, he served as Chairman and CEO of the group's Italian operations and later became the head of the European division. Mr. Belloni began his career at Procter & Gamble in Italy in 1978 and held various positions in Switzerland, Greece, Belgium, and the United States. In his role at LVMH, Mr. Belloni has held several directorial positions within the company and its subsidiaries. He serves as a Non-Executive Director of DFS Group Ltd. He is also Vice-Chairman of LVMH Moët Hennessy Louis Vuitton Inc. (United States) and Vice-Chairman and Member of the Supervisory Board of Berluti SA. Additionally, he serves as the Managing Director of Moët Hennessy Management SARL and International Benefit Cosmetics LLC (United States). Mr. Belloni holds various chairmanship positions within LVMH and its affiliated companies. He is the Chairman of the Supervisory Board at Cha Ling SCA, Chaumet International SA, Fendi International SAS, Fendi Srl (Italy), Vicuna Holding SpA (Italy), and LVMH (Shanghai) Management & Consultancy Co. Ltd (China). Moreover, Mr. Belloni serves as a director for several renowned brands, including Fred Paris SA, Barilla G. e R. Fratelli SpA (Italy), Givenchy SA, Le Bon Marché, maison Aristide Boucicaut SA, Bulgari SpA (Italy), Loro Piana SpA (Italy), and many others.
Bianchi, Stephane	Head of LVHM's Watch & Jewelry Unit	Mr. Stephane Bianchi has been Head of LVHM's Watch & Jewelry Unit at LVMH Moët Hennessy - Louis Vuitton, Société Européenne since July 1, 2020. He served as the Chief Executive Officer of Watchmaking Division at LVMH Moët Hennessy Louis since November 1, 2018 until July 1, 2020. Mr. Bianchi spent the majority of his career with the Yves Rocher Group, and most recently was on the board of the Maus Group (Lacoste).-
Das, Ipsita	Managing Director of India	Ms. Ipsita Das serves as Managing Director of India at LVMH Moët Hennessy - Louis Vuitton, Société Européenne since January 2021. Ms. Das joined Moet Hennessy as commercial director in 2019. Ms. Das has earlier worked with Uber, Maersk and Housing.com.-
de Lapuente, Christopher	Chairman & CEO of Selective Retailing Division	Mr. Christopher de Lapuente, also known as Chris, holds significant leadership positions within the beauty industry. He serves as the Global CEO and President of Sephora SA at Sephora USA, Inc. Additionally, he is the Chairman and CEO of the Selective Retailing Division and the former Chairman and CEO of the Perfumes & Cosmetics Division at LVMH Moët Hennessy Louis Vuitton. Mr. de Lapuente has an extensive background in the beauty sector, particularly with Sephora. He has been the CEO of Sephora and Beauty at LVMH since 2011 and previously held the position of Head of Sephora. Prior to his tenure at LVMH, he held prominent roles at The Procter & Gamble Company. He served as the President of Global Hair Care and later as the Group President of Global Professional and Retail Hair Care. Throughout his career, Mr. de Lapuente has demonstrated his expertise in brand management and marketing. He has held various positions within Procter & Gamble, including Vice President for UK & Eire, General Manager of Europe Feminine Care Germany, and Marketing Director for several regions. Mr. de Lapuente received his BSc Economics (Hons) from Buckingham University in 1983. With his wealth of experience and leadership in the beauty industry, he continues to drive the success and growth of Sephora and LVMH's Selective Retailing Division.
Guerra, Andrea	Head of Hospitality & Restaurant Business	Mr. Andrea Guerra holds several prominent roles within the business world. He currently serves as the CEO and Executive Director of Prada S.p.A. and the Head of Hospitality & Restaurant Business at LVMH Moët Hennessy - Louis Vuitton, Société Européenne. He has been the Executive Chairman of Eataly Company since 2015 and is a Senior Strategic Advisor to the Italian Prime Minister. Previously, Mr. Guerra served as the CEO of Luxottica Group SpA and Indesit Company S.p.A. He has held various directorial positions and has extensive experience in marketing and brand management. He has also served as an independent director for several companies, including Tapestry, Inc. and Amplifon SpA. Mr. Guerra is known for his expertise in brands, fashion, luxury goods, and durables. He holds a degree in Economics and Business Administration from La Sapienza University in Rome, earned in 1989. With his extensive experience and strategic acumen, Mr. Guerra continues to make significant contributions to the companies he is associated with.
Mukherji, Shantanu	Managing Director od L Catterton	Mr. Shantanu Mukherji has been Managing Director and served as Executive Director of L Catterton (formerly known as L Capital Asia) until February 2016 at LVMH Moet Hennessy Louis Vuitton S.E. since March 2013. Mr. Mukherji served as General Manager of LVMH watch and jewellery South Asia of LVMH Moet Hennessy Louis Vuitton since July 2002 to August 2007. Before joining LVMH in 2002, he was working with 'Nike' as marketing manager for South East Asia. He contributed in setting up Indian subsidiary of the company and also in setting up distributor network in South Asia, LVMH. He was also the Brand Manager for Dior watches in India, he led the successful re-positioning of the brand in the country. He holds B.Tech at IIT Delhi in Manufacturing Engineering from 1994 to 1998. He studied from Indian Institute of Management Ahmedabad from 1998 to 2000.-
Rogers, Ian	Chief Digital Officer	Mr. Ian Rogers has held significant roles in the technology and digital media industry. He currently serves as the Chief Experience Officer at Ledger SAS, where he oversees consumer-facing services for protecting digital assets. He is also an Independent Non-Executive Director at Dr. Martens Limited and Dr. Martens plc. Prior to his current positions, Mr. Rogers served as the Chief Digital Officer at LVMH, where he worked with numerous brands across various sectors, including fashion, leather goods, perfumes, cosmetics, wines, spirits, and selective retail. Some notable brands he collaborated with include Louis Vuitton, Dior, Sephora, and Hennessy. Mr. Rogers has a strong background in digital media and technology. He has held positions at Apple Inc., Beats Music, LLC, and Yahoo! Inc., where he played significant roles in the development and strategy of various digital media products and services. Additionally, Mr. Rogers has experience as an entrepreneur and has served as a director for companies such as Lyst Ltd. and Topspin Media, Inc. He has been involved in pioneering projects in the digital music industry and has a Bachelor of Arts in Computer Science from Indiana University. With his expertise in digital media and technology, Mr. Rogers continues to contribute to the advancement of digital experiences and asset protection in his current roles.
Voisin, Jean-Baptiste	Chief Strategy Officer	Mr. Jean-Baptiste Voisin has been the Director of Strategy at LVMH Moët Hennessy - Louis Vuitton, Société Européenne (formerly known as LVMH Moët Hennessy Louis Vuitton SE) since 2006.-
Beccari, Pietro	Chairman & CEO of Louis Vuitton	Mr. Pietro Beccari is Chairman & CEO of Christian Dior Couture at LVMH Moët Hennessy - Louis Vuitton, Société Européenne since 2018. He served as a Chairman and CEO of Christian Dior Couture S.A. since February 2018 until 2023. Mr. Beccari served as the Head of Hair Care and Cosmetics of Central Europe of Henkel Group. He spent his earlier career in Marketing at Benckiser in Italy and Parmalat in the US, then in General Management at Henkel in Germany, where he was Corporate Vice-President for Haircare. In 2006, he joined LVMH as Executive Vice-President Marketing and Communications for Louis Vuitton before becoming Chairman and Chief Executive Officer of Fendi in 2012. Since February 2018, he has been Chairman and Chief Executive Officer of Christian Dior Couture. He is also a member of the LVMH Executive Committee. He is a Business Administration graduate of Parma University in Italy.-
Boillot, Laurent	CEO & President of Guerlain	Mr. Laurent Boillot has been Chief Executive Officer and President of Guerlain SA, a subsidiary of LVMH Moet Hennessy Louis Vuitton since October 10, 2007 and serves as its Chairman. Mr. Boillot served as General Manager of Guerlain. He started his career in advertising in 1988 within the Havas Group. In 1990, he joined Univeler, held positions of increasing responsibilities in France and Spain. He served as Marketing Director of the European Hair Care Category at Unilever. In 2002, he joined Guerlain as Marketing Director. Mr. Boillot is a graduate of Rouen Business School.-
Brocart, Sophie	Chief Executive Officer of Jean Patou	Ms. Sophie Brocart serves as Chief Executive Officer of Fashion and Perfume Brand Jean Patou at LVMH Moët Hennessy - Louis Vuitton, Société Européenne (formerly known as LVMH Moët Hennessy Louis Vuitton SE) since October 2018. She currently serves as Senior Vice President of Fashion Venture at LVMH and as Chief Executive Officer of the group's British brand, Nicholas Kirkwood Ltd.-
Jamet, Marc-Antoine	General Secretary	Mr. Marc-Antoine Jamet serves as General secretary of LVMH Moët Hennessy - Louis Vuitton, Société Européenne (formerly known as LVMH Moët Hennessy Louis Vuitton SE). Mr. Jamet serves as the Chairman of the Board at Le Jardin D'acclimatation SA.-
Schaus, Philippe Paul Auguste	Chief Executive Officer of Moët Hennessy - Wines & Spirits Division	Mr. Philippe Paul Auguste Schaus has held significant leadership positions within the LVMH group. He currently serves as the Chief Executive Officer of the Moët Hennessy - Wines & Spirits Division at LVMH Moët Hennessy Louis Vuitton SE since October 1, 2017. Previously, he served as the Chief Executive Officer and Chairman of DFS Group Limited from August 1, 2012, until October 1, 2017. Mr. Schaus began his career in finance, working at J.P. Morgan before joining The Boston Consulting Group GmbH. In 1992, he joined Villeroy & Boch A.G., where he held various positions, including International Commercial Director and Managing Director of the Porcelain Tableware Division. In 2003, Mr. Schaus joined Louis Vuitton as President of the Europe Zone and later became Senior Vice President of International in 2006. He served as an Executive Vice President of Louis Vuitton from 2009 to 2011. In addition to his executive roles, Mr. Schaus serves as a director for several companies within the DFS Group, including DFS Australia Pty Limited and DFS New Zealand Limited. Mr. Schaus is a graduate of INSEAD, a prestigious business school. With his extensive experience in the luxury retail industry and his current leadership role at Moët Hennessy - Wines & Spirits Division, he continues to contribute to the success of LVMH and its associated brands.
Toledano, Sidney	Chairman and CEO of the Fashion Group	Mr. Sidney Toledano is a prominent figure in the luxury fashion industry, particularly within the LVMH group. He has held various executive positions, including CEO of Christian Dior SE and President of Fendi France. He has also served as Chairman for several LVMH fashion brands and holds directorial roles in numerous international companies. Mr. Toledano's extensive experience and leadership make him a key figure in the fashion industry.
Hollis, Christopher	Director of Financial Communications	Christopher Hollis, also known as Chris, is Director of Textainer Group Holdings Limited from June 01, 2023. Christopher Hollis is Director of Financial Communications of LVMH Moët Hennessy - Louis Vuitton, Société Européenne.-
Stalla-Bourdillon, Bertrand	Group Vice President of Retail Development	Mr. Bertrand Stalla-Bourdillon has been the Group Vice President of Retail Development and served as Chairman of the Board and Chief Executive Officer of Marc Jacobs International of LVMH Moet Hennessy Louis Vuitton since June 6, 2006. Mr. Stalla-Bourdillon joined LVMH group in 1986 where he had increasing responsibilities in finance positions for Loewe, Louis Vuitton Malletier and within the Fashion and Leather goods Division. In 2002, he was appointed General Manager, finance and administration for Louis Vuitton Malletier. At the same time, as President, he has successfully developed Berluti since 1995. Mr. Stalla-Bourdillon, after a commercial experience at IBM, mainly made his career within the LVMH group. He serves as a Director of Marc Jacobs International of Lvmh Moet Hennessy Louis Vuitton. Mr. Stalla-Bourdillon is an Engineer and MBA from HEC from 1981 to 1983 and Ecole spéciale des Travaux publics, du Bâtiment et de l'Industrie 1978 to 1981.-

Board Members

Name	Title	Type	Tenure
			Start date	End date
Arnault, Bernard	Chairman & CEO	Internal	1988	Present
Arnault, Antoine	Group Chief Image & Environment Officer and Director	Internal	2006	Present
Bazire, Nicolas	Senior VP of Development & Acquisitions and Director	Internal	1999	Present
Belloni, Antonio	Group MD & Director	Internal	2002	Present
Beccari, Pietro	Chairman & CEO of Louis Vuitton	Internal	2018	Present
Toledano, Sidney	Chairman and CEO of the Fashion Group	Internal	2018	Present
de Silguy, Yves-Thibault	Independent Director	External	2009	Present
Gaymard, Clara	Independent Director	External	2016	Present
Valla, Natacha	Independent Director	External	2020	Present
de Croisset, Charles	Lead Independent Director	External	2008	Present
Arthus-Bertrand, Yann	Member of Advisory Board	External	2019	Present
Aumont, Dominique	Employees Representing Director	External	2020	Present
Belloeil-Melkin, Marie-Véronique	Employees Representative Director	External	2020	Present
Chassat, Sophie	Independent Director	External	2018	Present
de Chalon, Marie-Laure Sauty	Independent Director	External	2014	Present
Della Valle, Diego	Member of Advisory Board	External	2002	Present
Gancia, Delphine Arnault	Director	External	2020	Present
Kravis L.L.D., Marie- Josée	Independent Director	External	2011	Present
Mignon, Laurent	Independent Director	External	2023	Present
Powell KCMG, Charles David	Member of Advisory Board	External	2020	Present
Védrine, M. Hubert	Independent Director	External	2004	Present

Committees

Committee	Name	Title
Audit Committee	Gaymard, Clara	Independent Director
	de Chalon, Marie-Laure S.	Independent Director
	de Croisset, Charles	Lead Independent Director
	de Silguy, Yves-Thibault	Independent Director
Compensation Committee	Valla, Natacha	Independent Director
	Chassat, Sophie	Independent Director
	de Croisset, Charles	Lead Independent Director
	Kravis, Marie- J.	Independent Director
Corporate Governance Committee	Valla, Natacha	Independent Director
	Chassat, Sophie	Independent Director
	de Croisset, Charles	Lead Independent Director
	Kravis, Marie- J.	Independent Director
ESG Committee	de Silguy, Yves-Thibault	Independent Director
	de Chalon, Marie-Laure S.	Independent Director
	Gancia, Delphine A.	Director
	Védrine, M. H.	Independent Director

ESG

Materiality Matrix

Particulars	Wines and Spirits	Fashion andLeather Goods	Perfumes and Cosmetics	Watches and Jewellery	SelectiveRetailing
State of energy resources and climate change	-Grape growing and yield -Packaging production -Distillation -Transportation of products -Soil erosion	-Store lighting, air conditioning and location -Transportation of products and carbon taxes -Production of resources needed to manufacture products: -Plant fibers used for textiles (cotton, etc.) Leather, including exotic leather, Fur, Wool -Customer expectations in relation to more sustainable products -Renewable energy costs	-Packaging production -Store lighting, air conditioning and location -Transportation of products and carbon taxes -Customer expectations in relation to more sustainable products -Renewable energy costs	-Store lighting, air conditioning and location -Renewable energy costs	-Store lighting, air conditioning and location -Transportation of products -Renewable energy costs
Impact on water resources	-Water consumption (vineyard irrigation in Australia, New Zealand, Argentina and California) -Production of effluents containing organic matter during winemaking and distillation	-Water consumption (crocodilian farms and tanneries) -Production Ofeffluents containing organic matter	- Water consumption (production and transformation of raw materials)	-Water consumption during the extraction of mineral resources needed to manufacture products -Production of effluents containing mineral matter
Impact on ecosystems (including deforestation and desertification) and depletion of natural resources	-Production of plant resources needed for other production processes (grape vines, barley, rye, etc.)' - Protecting biodiversity	-Production of resources needed to manufacture products: - Plantfibers used for textiles (cotton, etc.) Leather, including exotic leather Fur, Wool, Eider down -Farming and trapping practices concerning raw materials of animal origin Protecting biodiversity	-Production of plant resources needed to manufacture products (rose, jasmine, etc.) -Protecting biodiversity	-Extraction of resources needed to manufacture products: - Gems and precious metals -Exotic leather -Farming and trapping practices concerning raw materials of animal origin -Protecting biodiversity
Waste production	-Production of residues from winemaking or distillation processes and packaging waste -Circular economy	-Unused raw materials, obsolete and unsold products, window displays and events -Customer expectations in relation to more sustainable products -Circular economy	-Point-of-sale advertising, packaging waste, and obsolete and unsold products Circular economy	-Scrap metal - Circular economy	-Point-of-sale advertising, packaging waste, and obsolete and unsold products -Circular economy

Social & Environmental Responsibilities - Initiatives by LVMH

LVMH has made sustainable development a strategic priority since its founding.

LVMH has undertaken the following initiatives:

-     LIFE 360: LVMH environmental strategy for new luxury:

1. Biodiversity: 2030 -> 5 millions hectares of flora and fauna preserved.
2. Climate:
   1. 2026 -> 50% reduction in energy- related greenhouse gas (GHG) emissions.
   2. 2030 -> 55% reduction and/or avoidance of Scope 3 GHG emissions per unit of added value.
3. Create circularity: 2030 -> 100% of new products covered by a sustainable design approach.
4. Traceability: 2030 -> 100% of strategic chains covered by a dedicated traceability system.

-       2025 CSR

-       LVMH Ethics & Compliance

-       Diversity & Inclusion

-       ple back into work after long-term unemployment)

-       Disability Inclusion

-       LVMH Climate week

-       IUCN (protecting biodiversity)

-       Nona Source (encourage creative re-use of materials)

-       LIFE in Stores Awards

-       Maison/0

-       Health & Safety policy

-       Fighting Covid-19

-       We Care For Models

- Responsible Consumption at Moët Hennessy

Market

Total Addressable Market

Here, the total addressable market (TAM) is defined as the luxury goods global market, and based on a number of assumptions, it is estimated that the size of the market as of today (6^th July 2023) in terms of revenue, is US$354.80bn, and is expected to grow at a CAGR of 3.38% in the forecast period of 2023- 2027.

LVMH is the global leader in the luxury goods global market, having a market share of approximately 25% in terms of annual revenue. It operates in all geographic regions and covers all business groups of the luxury goods market. Making its Serviceable Available Market and Serviceable Obtainable Market equal to the Total Addressable Market.

Financial Highlights

Business Group - Highlights

Revenue by business group (EUR Millions)	2020	2021	2022
Wines and Spirits	4,755	5,974	7099
Fashion and Leather Goods	21,207	30,896	38,648
Perfumes and Cosmetics	5,248	6,608	7722
Watches and Jewelry	3,356	8,964	10,581
Selective Retailing	10,155	11,754	14,852
Other activities and eliminations	-70	19	281
Total	44,651	64,215	79,184

Profit from recurring operations by business group(EUR millions)	2020	2021	2022
Wines and Spirits	1,388	1,863	2,155
Fashion and Leather Goods	7,188	12,842	15,709
Perfumes and Cosmetics	80	684	660
Watches and Jewelry	302	1,679	2,017
Selective Retailing	-203	534	788
Other activities and eliminations	-450	-451	-274
Total	8,305	17,151	21,055

Revenue by business group

Revenue by geographic region delivery

Financial Statements

Historic

Most recent quarter

Comparing Q1 2023 to Q1 2022, in euro millions, the total LVMH group has experienced a 17% reported and organic increase in revenue from 18,003 to 21,035 respectively.

The Wines & Spirits business group recorded a revenue growth of 3% with an organic revenue growth of 14% of the Champagne & Wines sector, due to a strong start to year driven by positive price effect and China recovering from Covid impact, and a 5% organic revenue decrease of the Cognac & Spirits sector, due to the US being impacted by softer economic environment.

The Fashion & Leather Goods business group recorded a revenue growth of 18%, due to exceptional performance, driven by creativity and iconic products, specially in Louis Vuitton.

The greatest revenue evolution was observed in the Selective Retailing sector, where an increase of 28% was recorded due to Sephora's strong performance, DFS benefiting from recovery in travel, notably in Asia and Le Bon Marché with its creative animations.

Most recent year

For the fiscal year 2022, ending on the 31st of December, LVMH reported an annual revenue of 79.2 billion euros a 23.3% increase over the previous fiscal year, 2021, as can be seen hereunder. As well as a 17% increase in the groups share of net profit, increasing from 12.036 billion euros in 2021 to 14.084 billion euros in 2022.

Other important financial indicators include:

• dividend of 12 euros in 2022, increased by 20% compared to 2021.
• Gearing of 16% compared to a gearing of 20% in 2021. (Gearing: the ratio of a company's debt to equity)

LVMH's Annual Income Statement

EUR €, Millions, except for earnings per share data	2020	2021	2022
Period Ending:	31-Dec	31-Dec	31-Dec
Revenue	44,651	64,215	79,184
Revenue Growth (year to year)	-16.80%	43.82%	23.31%
Cost of Goods and Services	-15,871	-20,355	-24,988
Gross Margin	28,780	43,860	54,196
Marketing and selling expenses	-16,792	-22,308	-28,151
General and administrative expenses	-3,641	-4,414	-5,027
Income/(Loss) from joint ventures	-42	13	37
Profit from recurring operations	8,305	17,151	21,055
Other operating income and expenses	-333	4	-54
Operating profit	7,972	17,155	21,001
Cost of net financial debt	-35	41	-17
Interest of lease liabilities	-281	-242	-254
Other financial income and expenses	-292	254	-617
Net financial income/(expense)	-608	53	-888
Income Tax Expense	-2,409	-4,510	-5,362
Net Income to Company	4,955	12,698	14,751
Minority Interest in Earnings	-253	-662	-667
Net Income to Stockholders	4,702	12,036	14,084
Basic EPS, (EUR)	9.34	23.90	28.05
Basic Weighted Average Shares Outstanding	503,679,272	503,627,708	502,120,694
Diluted EPS (EUR)	9.33	23.89	28.03
Diluted Weighted Average Shares Outstanding	504,210,133	503,895,592	502,480,100
EBITDA	13,780	23,280	26,720

LVMH's Annual Balance Sheet

Year end date (31/12)	2020	2021	2022
Assets (EUR millions)
Brands and other intangible assets	17,012	24,551	25,432
Goodwill	16,042	25,904	24,782
Property, plant and equipment	18,224	20,193	23,055
Right-of-use assets	12,521	13,705	14,615
Investment in joint ventures and associates	990	1,084	1,066
Non-current available for sale financial assets	739	1,363	1,109
Other non-current assets	845	1,054	1,186
Deferred tax	2,325	3,156	3,661
Non-current Assets	68,698	91,010	94,906
Inventories and work in progress	13,016	16,549	20,319
Trade accounts receivable	2,756	3,787	4,258
Income taxes	392	338	375
Other current assets	3,846	5,606	7,488
Cash and cash equivalents	19,963	8,021	7,300
Current Assets	39,973	34,301	39,740
Total Assets	108,671	125,311	134,646
Liabilities and Equities (EUR millions)
Long-term borrowing	14,065	12,165	10,380
Non-current lease liabilities	10,665	11,887	12,776
Non-current provisions and other liabilities	3,322	3,980	3,902
Deferred tax	5,481	6,704	6,952
Purchase commitments for minority interests' shares	10,991	13,677	12,489
Non-current liabilities	44,524	48,413	46,499
Short-term borrowing	10,638	8,075	9,359
Current lease liabilities	2,163	2,387	2,632
Trade accounts receivable	5,098	7,086	8,788
Income taxes	721	1,267	1,211
Current Provisions and other liabilities	6,698	9,174	9,553
Current Liabilities	25,318	27,989	31,543
Total Liabilities	69,842	76,402	78,042
Equity, Group Share	37,412	47,119	55,111
Minority Interests	1,417	1,790	1,493
Total Equity	38,829	48,909	56,604
Total liabilities and Equity	108,671	125,311	134,646
Total Debt	37,531	34,514	35,147

LVMH's Cash Flow Statement

EUR €, Millions	2020	2021	2022
Cash flow operating activities
Operating profits	7,972	17,155	21,001
Income/loss and dividends received from joint ventures and associates	64	41	26
Net increase in depreciation, amortisation and provisions	3,478	3,139	3,219
Depreciation of right-of-use assets	2,572	2,691	3,007
Other adjustments and computed expemses	-89	-405	-483
Cash from operations before changes in working capital	13,997	22,621	26,770
Cost of net financial debt: interest paid	-58	71	-74
Lease liabilites: interest paid	-290	-231	-240
Tax paid	-2,385	-4,239	-5,604
Change in working capital	-367	426	-3,019
Net cash from/ (used in) operating activities	10,897	18,648	17,833
Cash flow investing activities
Operating investments	-2,478	-2,664	-4,969
Purchase and proceeds from sale of consolidated investments	-536	-13,226	-809
Dividends received	12	10	7
Tax paid relates to non-current available for sale financial assets	-	-	-
Purchase and proceeds from sale of non-current available for sale financial assets	63	-99	-149
Net cash from/ (used in) investing activities	-2,939	-15,979	-5,920
Cash flow financing activities
Interim and final dividends paid	-2,799	-4,161	-6,774
Purchase and proceeds from sale of minority interests	-67	-435	-351
Other equity-related transaction	27	-552	-1,604
Proceeds from borrowings	17,499	251	3,774
Repayment of borrowing	-5,024	-6,413	-3,891
Repayment of lease liabilities	-2,302	-2,453	-2,751
Purchase and proceeds from sale of current available for sale financial assets	69	-1,393	-1,088
Net cash from/ (used in) financing activities	7,403	-15,156	-12,685
Effect of exchange rate changes	-1,052	498	55
Net increase/ decrease in cash and cash equivalents	18,773	-43,124	-717
Cash and cash equivalents at the beginning of period	5,497	19,806	7,817
Cash and cash equivalents at end of period	19,806	7,817	7,100
Total tax paid	-2,501	-4,464	-5,933
Alternative performance measure
EUR €, Millions	2020	2021	2022
Net cash from operating activities	10,897	18,648	17,833
Operating investments	-2,478	-2,664	-4,969
Repayment of lease liabilities	-2,302	-2,453	-2,751
Operating free cash flow	6,117	13,531	10,113

[[File:Cash Flow Statement.png|Cash Flow Summary]

Financial Forecast

What are the assumptions used to estimate the financial forecasts?

Description	Value	Commentary
What’s the estimated current size of the total addressable market?	$354,800,000,000	The total addressable market is defined as the luxury goods global market and , it is estimated that the size of the market as of today (6th July 2023) in terms of revenue, is US$354.80bn.
What growth stage is the company in?	Maturity stage	Research shows that a company goes through four/ five stages of cash flow growth. A key way to determine the stage which a company is in by examining the cash flow patterns. The Stockhub users estimate that with LVMH’s cash flow patterns over the past 4 years: (+) operating cash flow, (-) investing cash flow and (+/-) but with a (-) average of it’s financing cash flow. LVMH is in its maturity stage of growth.
What is the estimated company lifespan? Group - LVMH	80 years	LVMH employees approximately 196,000, making the company a large organisation, research has proven that the average life span of a large company is approximately 50 years. Due to LVMHs exponential revenue growth in the last 36 years, and assuming that the company is in the maturity stage of growth which is approximately 50% of a companies lifecycle, I am going to assume a life span of 80 years.
What is the estimated annual growth of the total addressable market over the lifecycle of the company?	3.38%	The market is estimated to grow at a 3.38% CAGR (Compound Annual Growth Rate) in the forecast period of 2023- 2028.
What is the estimated company peak market share?	Approximately 25%	Take LVMH’s revenue as the revenue specified at the end of 2022, which was 79.2 billion euros. Assuming a currency exchange rate as of 31st Dec 2022 EUR/USD of 1.07. Resulting in a companies annual revenue of 84.744 billion USD.
Which distribution function do you want to use to estimate company revenue?	Gaussian	Research has suggested that the revenue pattern of companies is similar to the pattern produced by the gaussian distribution.

Economic links to cash flow patters

Cash flow type	Introduction	Growth	Shake out	Mature	Decline
Operating	-	+	+/-	+	-
Investing	-	-	+/-	-	+
Financing	+	+	+/-	-	+/-

Valuation

When estimating the expected return on an investment over a period of 12-months or more, the most accurate approach is a DCF. In the following section, there are 2 valuation methods, the DCF model and the relative valuation, both models are used in the report for completeness.

For the DCF model, the weighted average between the bull case, base case, and bear case obtained $1142.65 share price which has a 31.29% upside.

A simple 50% base case, 25% bull case, and bear case are used because of the uncertainty of the decision of the FOMC on the terminal interest rate. The new reported number on the CPI, consumer price index, has back down to 3% whereas the previous number is 4%. If the FOMC, federal open market committee, does not decrease the interest rate in around September or November, the market will likely be looking at deflation instead. Although the non-Farm payroll has a strong number and a low unemployment rate, the participation rate is much lower than the average, which indicates that the unemployment is not accurately reflected. According to the backtesting research, whenever the FOMC decreases the interest rate, the transition from hawkish to dovish sentiment, resulting in a short squeeze of the stock market and then a big fall, the target is likely to be reached in the next few months when the interest rate is not likely to be increased. A dovish sentiment is an interest rate policy that is more accommodative to stimulate spending in an economy, which is clearly good for the luxury good market.

Also, for the growth rate, the function of (Estimated revenue in the last year which is 2027 divided by Actual revenue in 2018 which is the first)^(1/10) - 1 is used. Whereas all growth is constant in the next 5 years with a constant revenue growth of approximately 16.2%, taken from the average of the revenue growth during the last 4 years. This method was also used to calculate the % change in COGS, Operating expenses, Selling, General and administrative and tax% of EBIT. Resulting in the financial forecast of LVMH of the next 5 financial years.

The risk-free rate takes the US 10-year treasury bond yield rate. The Beta value takes the 5 Year monthly, which has a value of 1.03 which suggests that LVMH moves with more momentum than the S&P 500 stocks. This beta suggests that it’s not a very risky investment as it doesn’t deviate a lot from the market beta of 1. Although theoretically it does increase a portfolios risk by 3% and may increase the expected return.

Looking at the numbers in the DCF model, for the base case, we assumed a constant percentage increase. The China PPI (producer price index ) number is lower than expected, falling by 5.4 percent in June from the previous year, marking the steepest fall since December 2015. Despite the issue remaining from 2022, the revenue and profit numbers remain strong in the Chinese Market in LVMH. When this situation is relieved, the buying power is likely to be released and the consumer discretionary industry is more likely to be getting the attention. The number is likely to be higher than the prediction from using the constant percentage increase.

For the Bear case, the free cash flow to equity has a slight decrease from 2021 to 2022. Although the number remains much higher than in 2020, if the situation persists, the prediction from using the combined result from the free cash flow to equity and Net Debt to EBITDA is likely to be lower. The free cash flow to equity has just turned positive from 2021, More data from 2023 is needed to check if the trends remain. Furthermore, the Japanese yield curve policy might change on the 28th of July. The Japanese currency Yen is usually borrowed and bought stocks in other markets, such as the US market. The cost would therefore be higher, the target return requires higher expectations on the trade and the market power is likely to be suppressed.

For the Bull case, LVMH and Google announced a strategic partnership to accelerate innovation and develop new cloud-based artificial intelligence (AI) solutions in 2021. This creates new, personalized customer experiences that foster long-term growth. LVMH will be able to take actions to improve the overall business efficiency, from customer experience personalization to product development and logistics, on top of the current machine learning trend. Therefore, the earning number increased by 23%, taking the change from 2021 to 2022.

The bull case and bear case are calculated with the earnings in EV/EBITDA and Net Debt/EBITDA, and the Free Cash Flow Equity Yield based on their free cash flow, both earning price target and the FCFE price target are weighted 50% each. Throughout the calculation, we obtained the WACC of 13.33% and the CAPM, capital asset pricing model, is 14.08%, and the difference between ROIC%, return on invested capital, and WACC% is 5%. Furthermore, the CapEx has decreased by 10% every year since 2018, indicating that the company is investing its money in future growth. Suggested as well by a decreasing EBITDA but increasing gross profit. Due to the uncertainty of the predicted value of the CPI, we believed that the actual upside of the share price would be higher, because of the effect of lowering the interest rate for the first time in the third bull phase according to Dow's theory and the transition from hawkish sentiment to dovish sentiment.

For the relative valuation, firstly, its Piotroski F-Score (discrete score between zero and nine used to determine the strength of a firm's financial position) where LVMH has scored a 9. Altman Z-Score (measures the likelihood of a publicly traded company going bankrupt - a value close to 0 suggests a company might be going bankrupt and a value close to 3 suggests a company is in a solid financial position) where LVMH has scored a value of 4.59. The Beneish M-Score indicates that LVMH is not a manipulator on their financial reports.

Secondly, The PE ratio is currently at 30.5, which is just above the median of its history of 24.71, the minimum value of 11.39, and the maximum value of 78.7. Although the PE ratio is ranked worse than 74.97% across the whole retail-cylindrical industry, LVMH has a huge increase in Revenue, EPS, and operating cash flow, indicating that LVMH remains undervalued if this trend continues.

This prediction could be seen by looking at the PEG (Price/ Earnings-to-Growth) value, which has a value of 1.5. The median value in its history is 2.28, which is way lower than the maximum value of 5.65 in its history.

Thirdly, the EV-to-EBITDA is currently at 16.89, which has a similar value to the medium of 12.85. Although it has a higher value than 10, it is significantly lower than its competitors in the industry, where Hermes International SA, St Dupont SA, and Maison Clio Blue SA have the EV-to-EBITDA of 35.02, 124.72, 395.23, this indicating that LVMH is undervalued compared to the industry.

The PS ratio is currently at 5.42, it is near to the medium for the past 10 years of 3.05, and has a similar number comparing to the industry, which is 4.5. This indicating that the LVMH stock is slightly undervalued comparing to its industry.

In summary, both the results from the DCF model and the relative valuation method indicate that LVMH is undervalued, compared to itself in history, the industry, and the potential growth using its free cash flow. LVMH has a potential upside of 31.09% upside.

Growth Drivers and Catalysts

LVMH has a strong set of growth catalysts that are attractive to potential investors.

1. Digital Transformation and E-commerce: LVMH's recognition of the digital transformation in the luxury goods industry has been a pivotal driver of its growth. The company has invested heavily in its e-commerce capabilities, enabling customers to access its luxury shopping experience from the comfort of their homes. By embracing online channels, LVMH has built a stronger brand image and enhanced customer loyalty. Its commitment to digital marketing campaigns during the pandemic enabled the company to outperform competitors and achieve significant growth in 2020, even amidst store closures. The ongoing focus on digital innovation and e-commerce positions LVMH to capitalise on the increasing trend of online luxury retail.

2. Expansion in Emerging Markets: LVMH's strategic expansion into emerging markets has played a crucial role in its continued growth. With stable economies and rising disposable incomes, regions such as Asia (particularly China and Japan) and Brazil offer immense potential for luxury goods consumption. LVMH's presence and investments in these markets have allowed the company to capture new customer segments and grow its market share. The robust revenue growth of 23% across all markets and branches in 2022 underscores LVMH's ability to navigate economic and geopolitical challenges while delivering exceptional performance. Continued expansion in emerging markets remains a significant growth catalyst for LVMH.

3. Diversified Brand Portfolio: LVMH's wide range of high-end products across multiple sectors has been instrumental in its sustained growth. The company's portfolio encompasses renowned brands in wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewellery, and selective retailing. LVMH's diverse offerings cater to various consumer preferences and capture attention in multiple markets. Revenue growth across all sectors in 2022 further exemplifies the strength of LVMH's brand portfolio. The strategic acquisition of Tiffany & Co. in 2021 for $15.8 billion exemplifies the company's commitment to diversification, reducing its reliance on specific products or sectors and mitigating risks associated with market conditions. LVMH's ability to innovate and introduce new products keeps it at the forefront of the luxury goods market.

4. Focus on Brand Development and Innovation: LVMH's emphasis on brand development and innovation solidifies its position as an industry leader. The company remains dedicated to enhancing its brands and pursuing innovation-driven strategies. A notable recent development is the partnership with Epic Games, the creator of Unreal Engine and Fortnite. Through this collaboration, LVMH aims to transform its creative pipeline and attract a new customer base. By leveraging Epic Games' powerful 3D creation tools, LVMH can create visually captivating and immersive product experiences. This partnership opens up new digital ecosystems for advertisement campaigns and digital stores, offering customers unique and engaging interactions with LVMH brands. LVMH's focus on brand development and innovation ensures its continued relevance and growth in a rapidly evolving market.

In summary, LVMH's strong set of growth drivers, including its focus on digital transformation, expansion in emerging markets, diversified brand portfolio, and commitment to brand development and innovation, position the company for long-term success. These factors enable LVMH to capture opportunities in the evolving luxury goods landscape, attract a broader customer base, and maintain its position as a leading global luxury conglomerate.

Competitors Comparison

Globally, there are mainly two big luxury groups competing with LVMH. They are Kering and Richemont. LVMH has a huge number of brands base, while other companies have unique brands that LVMH does not have, such as fine jewellery and watches, so if LVMH wants to develop all the luxury goods industry, it needs to think about acquiring more fine jewellery/watch brands in order to achieve the status of being the dominant player in the luxury industy.

LVMH Overview: In 2023, LVMH reported a Q1 FY 2023 revenue of 21 billion euros, showing a significant increase of 17% compared to the same period in 2022. LVMH's strength lies in its high level of customer loyalty and diverse portfolio of 75 prestigious brands across various luxury sectors.

Richemont Overview: Richemont, a key competitor of LVMH, reported a sales revenue of 19.95 billion euros in the first quarter of FY 2023. Richemont's focus on watches and jewellery, particularly through brands like Cartier, IWC, and Van Cleef & Arpels, has contributed to its continued growth.

Kering Overview: Kering, another significant competitor of LVMH, reported a revenue of 5.077 billion euros in the first quarter of FY 2023. Kering's most prominent brand, Gucci, contributes significantly to its overall revenue. However, Kering has a weak growth rate of 1% compared to Q1 2022 suggests that its performance is not as strong as that of LVMH and Richemont.

Strengths of Richemont:

1. Focus on watches and jewellery: Richemont's specialization in these sectors has allowed it to become a leader in the industry, attracting customers who specifically seek luxury timepieces and high-end jewellery, and its emphasis on core businesses resonates well with customers who value the culture, history, and pioneer status in the industry.

2. Extensive collection of luxury brands: With 26 luxury brands and businesses in its portfolio, Richemont offers a wide range of options to cater to different consumer preferences.

3.  Richemont's commitment to environmental, social, and governance (ESG) practices in this year is highly attractive to customers and aligns with current policies and expectations.

Strengths of Kering:

1. Customer loyalty to specific brands: Kering has built strong brand loyalty, particularly with Gucci, Bottega Veneta, and Saint Laurent. This customer loyalty contributes to a consistent customer base and brand recognition.

Weaknesses of LVMH in comparison to Richemont:

1. Less competitive in the jewelry industry: LVMH's presence in the jewelry sector is relatively weaker compared to Richemont. To capture a larger market share and increase profitability, LVMH should consider expanding its focus on jewellery.

2. Sustainability focus: Customers are increasingly concerned about sustainability, and products marketed as environmentally friendly have gained traction.

Conclusion:

1. Richemont could be a big competitor: Based on the revenue data and performance analysis, LVMH remains the market leader in the luxury industry. However, it faces major challenges from Richemont, each with its own strengths and weaknesses. LVMH should focus on expanding its presence in the jewellery industry to compete more effectively with Richemont. Besides, The decision of Richemont to reject the acquisition proposal from LVMH could potentially impact Richemont's stock and attract more attention, particularly from investors who value the "more boutique in core business" mindset.

Overall, LVMH's performance is expected to continue to increase, and there is optimism regarding its total revenue for 2023.

Risks

Investing in any company, including LVMH Moët Hennessy, carries various risk factors. These risks should be carefully considered by potential investors before making a decision. Some risks specifically associated with LVMH Moët Hennessy might include:

1. Economic Fluctuations: As a luxury goods company, LVMH's success is strongly correlated with the global economy's performance. During periods of economic downturn, consumer spending, especially on luxury items, often decreases. This could negatively impact LVMH's revenues and profits.
2. Foreign Exchange Risk: Since LVMH operates worldwide, it's exposed to fluctuations in various currencies. If the euro strengthens against other currencies, it could reduce the company's profits when overseas earnings are converted back into euros.
3. Fashion Trends and Consumer Preferences: The fashion industry is notably fickle, with trends and consumer tastes constantly changing. If LVMH fails to anticipate or adapt to these changes, its brands might lose popularity, impacting the company's financial performance.
4. Regulatory Risks: As a global company, LVMH must comply with a wide array of regulations and laws across multiple jurisdictions. Changes in these regulations, including import/export laws, environmental laws, and taxation policies, could affect its operations.
5. Brand Reputation: The value of LVMH's brands is one of its key assets. Any events that damage these brands' reputations – such as product quality issues, scandals involving brand ambassadors, or negative environmental or social impacts – could harm LVMH's business.
6. Competition: The luxury goods market is highly competitive. LVMH competes with other large luxury groups, as well as smaller, more nimble brands and emerging digital-native brands. If LVMH can't maintain its competitive advantage, it could lose market share.
7. Supply Chain Disruptions: LVMH relies on a complex global supply chain. Disruptions to this chain – such as those caused by natural disasters, geopolitical events, or pandemics – could impact its ability to produce and distribute its products.
8. Intellectual Property Risks: As with many companies in the fashion industry, LVMH faces risks from counterfeiting and other intellectual property violations, which could harm its brands and its financial performance.
9. Technology Disruptions: The rapid pace of technological advancements and digital disruptions pose risks to the luxury goods industry. Failure to effectively adapt to evolving technologies, such as e-commerce platforms, artificial intelligence, and data analytics, could impact LVMH's competitiveness and ability to reach target customers.
10. Sustainability and Ethical Concerns: Increasing consumer awareness and expectations regarding sustainability and ethical practices pose risks to companies in the luxury goods sector. Failure to meet these expectations or address environmental and social concerns adequately may harm LVMH's reputation and customer loyalty.
11. Dependency on Key Personnel: LVMH's success is partly attributed to the expertise and leadership of key personnel, including executives and creative directors. The loss of key individuals or their departure from the company could disrupt operations, strategic direction, and the ability to sustain growth.