Prada Group: Sales Growth Still Solid Supported by Stellar Miu Miu Performance; Shares Fairly Valued

We maintain our fair value estimate for narrow-moat Prada Group at HKD 48 per share as the company reported solid sales numbers for the first nine months. Like other luxury peers, Prada Group has seen a meaningful deceleration in the third quarter with 10% growth (broadly in line with peers like LVMH with 9% growth for its fashion and leather goods division and 9% growth for Moncler), compared with around 20% growth delivered in the first half. We believe Prada Group should be among the top luxury performers over the near term on strong brand momentum. That said, we see shares as fairly valued at current levels.