Laopu Gold outshines Chow Tai Fook as China’s top jeweller with 437% stock surge

If anything glitters in China’s otherwise dour retail jewellery landscape, chances are it just might be from Laopu Gold.

The Beijing-based jeweller, whose Chinese name translates to “old shop”, is luring shoppers as it outshines market leader Chow Tai Fook Jewellery Group and other local brands, from sales growth to stock performance. Revenue increased 148 per cent year on year in the first six months of 2024 and is on course for more than doubling this year, while shares have surged 437 per cent since its listing in Hong Kong in June – making it the best performer on the Hang Seng Composite Index this year.

The 14-day relative strength index on the stock has breached 80 at least five times since its market debut, a rare level that is considered indicative of an outperformer. An RSI value of 70 and above typically denotes the stock is overbought, but analysts are still bullish, with all 14 covering the company recommending buying the stock, data compiled by Bloomberg shows.

Founded 15 years ago, the company has opted to stay small – at just 33 stores – and offers mostly Buddhism-inspired heritage gold jewellery that carry fixed prices, as opposed to local brands that usually price items based on weight. That is an important distinction for Laopu, one that has helped burnish its luxury quotient and draw comparisons with global labels such as Cie Financiere Richemont’s Cartier and LVMH’s Tiffany – a rare feat for a Chinese label.

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The story of Chow Tai Fook – from goldsmith to jewellery conglomerate

The story of Chow Tai Fook – from goldsmith to jewellery conglomerate

Laopu’s “relatively small size” is an advantage that is allowing it to focus on quality over quantity, said Mark Tanner, managing director of consultancy China Skinny in Shanghai. The brand “fills a space” in the untapped China-made luxury market, he said.

A 7.2 gram Laopu gold necklace with diamond studded gold pendant retails for anything from 11,230 yuan (US$1,540), much higher than if it were to be sold just based on the gold’s weight. The brand also draws those seeking exquisite decorative ornaments that touch on classic Chinese elements. Price tags for those can read hundreds of thousands of yuan.