Graff Diamonds to open second Hong Kong branch

More IPO glitter comes to Hong Kong.

Graff Diamonds, the London-based jeweler that claims to have handled more exceptional gems than any other, will IPO in Hong Kong to finance its expansion within Asia, especially in China.

Graff’s IPO could raise up to US$1 billion and increase the company’s equity to some US$5 billion.

Graff aims to open stores in Hong Kong, Macau and Hangzhou with proceeds from the IPO. It has stores in Hong Kong, Beijing, Shanghai, Taipei and Tokyo.

Its selection of Hong Kong is seen as a huge vote of confidence in the city since it comes at a time when slowing Chinese growth is putting a brake on overall consumer spending.

Chief Executive Officer Francois Graff, however, told the press that the very wealthy people who buy high-end diamond jewelry have seen no fall off in their purchasing power despite continued concerns about global growth.

“We are operating at the pinnacle of the luxury goods, diamonds and jewelry business, and the consumers that we attract are extremely insulated to the general gyrations of the world economy and the Chinese economy,” said Graff.

Graff’s listing will be the latest trophy for Hong Kong’s stock exchange that has been wooing foreign luxury retailers that want to raise capital and their profile among Asian consumers. Among the objects of Hong Kong’s attention are Prada and Samsonite.

By 2020, Chinese buyers are expected to account for 20% of global diamond jewelry consumption. In 2000, the Asia-Pacific region accounted for just 5% of consumption.

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Tags: Graff Diamonds, IPO, Hong Kong