Kering Shares Fall 3% Despite Stake Acquisition in Raselli Franco

Market Reaction and Technical Indicators

Kering's stock closed on Friday at 300.60 euros, down 3.13% from the previous day when the stock was valued at 310.30 euros. Kering was thus among the largest declines in the CAC 40 on December 19. Trading volumes remained particularly limited, with only 0.08% of the capital traded, reflecting some investor caution at year-end. This pullback comes after a period of notable progress, with the stock up 3% over the week and 11.85% over three months. Over a year, the performance remains spectacular with a gain of 26.76%, illustrating the group's gradual recovery from historically low levels reached in early 2024. This technical retreat occurs as the stock approaches its major resistance zone at 321.35 euros. The RSI, established at 67, is approaching the overbought zone at 70, suggesting a possible exhaustion of the bullish momentum in the short term. The price is now hitting its 50-day moving average at 306.71 euros, which now constitutes a crucial technical support. The 200-day moving average at 231.14 euros, however, confirms a fundamentally bullish trend over several months. The MACD histogram remains positive at 2.54, indicating that the momentum is generally favorable despite this consolidation. The market context remains cautious for the luxury sector at the end of the year. The recommendation from Oddo BHF, published on December 18 and maintained at Neutral with a target price of 322 euros, was not enough to support the stock. Investors are also integrating the prospects of a fourth quarter likely comparable to the third, without significant improvement in short-term commercial dynamics. The weakness in volumes reflects a persistent wait-and-see attitude ahead of the annual results expected in February 2026.

Strategic Acquisition in Jewelry Manufacturing

Kering announced on Thursday a 20% stake acquisition in the capital of the jewelry manufacturer Raselli Franco Group for an amount of 115 million euros. The agreement provides for a trajectory to acquire 100% by 2032, with a first step scheduled for the first quarter of 2026. This operation values the Italian company at around 575 million euros. This is the first acquisition made by Luca de Meo since he took office in September 2025 as the head of the French luxury group. Founded in 1969, Raselli Franco Group is internationally recognized for its exceptional expertise and innovation capabilities in prototyping and jewelry production. The company covers the entire value chain, from sourcing raw materials and precious stones to quality control, through research and development, design, and assembly. Based in Valenza, between Milan and Turin, the manufacturer employs more than 500 people and produces annually more than 300,000 pieces for the biggest luxury houses. This transaction is part of Kering's strategy to support long-term growth of its Houses and to strengthen its control over its value chain. CEO Luca de Meo emphasized that this acquisition will secure essential production capacities for the group's jewelry activity, which includes the houses Boucheron, Pomellato, Dodo, and Qeelin. These brands display a growth dynamic and significant revenue recurrence, giving them long-term resilience according to the group. The operation illustrates Kering's desire to expand into segments less exposed to fashion cycles.

Deleveraging Strategy Amidst Operational Challenges

This acquisition comes in a context where Kering is actively pursuing its deleveraging strategy. The group finalized on December 16 a co-investment agreement with Ardian involving a property located at 715-717 Fifth Avenue in New York, valued at 900 million dollars. Kering contributes this asset to a joint venture in which it retains 40%, cashing in a net amount of 690 million dollars, equivalent to 587 million euros. This operation follows a similar partnership concluded in Paris at the beginning of the year, which had generated 837 million euros. These real estate sales allow the group to gradually reduce its debt, which reached 9.5 billion euros in the first half of 2025, while retaining the commercial use of strategic locations for its houses. François Pinault's strategy aims to lighten the financial structure of the group, weakened by several acquisitions made in recent years, including those of Creed and Valentino. In December, Kering also finalized the sale of its beauty division to L'Oréal, a transaction announced in October that should also significantly reduce indebtedness. Operationally, the group remains confronted with the persistent difficulties of Gucci, its flagship brand which represents more than half of the revenue. The results for the third quarter showed a 10% decrease in revenue to 3,415 million euros. The consensus of analysts expects a net profit per share of 6 euros for 2025, compared to 10 euros in 2024, reflecting a decline in profit expectations. The recovery of the group, initiated by Luca de Meo, could take several months according to the statements of the leader, who bets on less dependence on Gucci and a structural repositioning of the brand portfolio.