Chow Tai Fook, a leading jewelry company based in Hong Kong, saw its shares surge by 15% on Friday following the announcement of a record high profit attributable to shareholders of 9 billion Hong Kong dollars ($1.15 billion) for the financial year ending March, representing an increase of more than 50% year-over-year [1]. The company's operating profit also rose to 18.9 billion Hong Kong dollars, marking a 27.8% year-over-year increase [1].
The significant profit growth was attributed to higher gold prices, which boosted overall profit margins and gross profits from weight-based gold products, according to Chow Tai Fook's chief financial officer Karen Yih [1]. Yih also highlighted strong demand for the company's design-led and high-margin fixed-price jewelry, particularly in higher-tier Chinese cities and international markets, noting that demand for these products remains resilient even during periods of gold price volatility [1].
Citi analysts noted that Chow Tai Fook's guidance for the 2027 financial year exceeded expectations in both sales and margins. Same-store sales growth in April and May was also stronger than anticipated, driven by a recovery in demand for weight-based gold jewelry as gold prices pulled back [1]. Citi further estimated that the company could achieve net profit margin growth in 2027 through plans to open more luxury and self-operated stores, as well as expanding its signature jewelry collections [1].
Gold prices experienced a notable increase from late 2025 to early 2026 as investors sought safe-haven assets amid macroeconomic and geopolitical uncertainties, but have since declined about 20% since the start of the Iran war [1]. Chow Tai Fook shares last traded 15.38% higher [1].
CONCLUSION
Chow Tai Fook's record profits and strong share price performance were driven by higher gold prices and resilient demand for its jewelry products. The company's positive outlook and expansion plans suggest continued growth potential, with analysts expecting further margin improvements in the coming year.