Brunello Cucinelli market value doubles since IPO

Italian luxury knitwear brand Brunello Cucinelli SpA has more than doubled in value since its initial public offering in Milan last April, giving Cucinelli a net worth of at least 1 billion dollars, according to the Bloomberg Billionaires Index.

“From the beginning we hoped for a positive and gentle listing,” Cucinelli said in a phone interview with Bloomberg from Milan. “Investors appreciate our quality, our positioning in the absolute luxury market and our Italian heritage.”

In the same way thinks William Hutchings, an analyst for Goldman Sachs quoted by ‘Esquire’, explained the success behind this landmark, noting that there are grounds for these figures: "There are only a few luxury brands that can justify Cucinelli's price positioning," noted.

"Design, history, quality, manufacturing, and provenance all support its price position and the company is well positioned to benefit from growing global demand for high-quality, authentic luxury products," Hutchings added.

Brunello Cucinelli has just reported sales of 360 million dollars for the full year in 2012, up 16 percent on a year-on-year basis. It forecast “modest double-digit” revenue growth for 2013, Bloomberg News reported in February.

“It is chic sportswear where the quality of the finishing is very high,” Armando Branchini, founder of Milan-based luxury consultant Intercorporate, said in a telephone interview. “Cucinelli offers couture finishing, elegance and sophistication and yet you can wear it in a very casual way.”

Cucinelli’s 63 percent stake is valued at 947 million dollars. He gained more than 90 million selling shares in the IPO.

Shares at IPO oversubscribed

Cucinelli's initial public offering (IPO) was relatively small but was still seen by the Italian bourse as a welcome boost, as Raffaele Jerusalmi, chief executive of Borsa Italiana told Reuters at the launch ceremony in April last year: "I think the success of Ferragamo and Cucinelli will convince other Italian luxury companies to list in Milan, maybe this year, but more probably next."

The IPO raised 158 million euros (208 million dollars) from international investors and from well-known fashion names such as Benetton BNG.MI, which is delisting from the Milan exchange, and menswear maker Ermenegildo Zegna. The offering of about a third of its shares was more than 17 times oversubscribed, leading it to close the books earlier than planned.

Company shares rose four cents to 16.75 euros in Milan last trading, giving the group a market capitalization of 1.5 billion dollars.