While LVMH is often seen as a conglomerate with a complex structure, the reality is actually much simpler, argues the broker, highlighting that Bernard Arnault's group's fashion and leather goods division alone generates 47% of the company's revenue and 72% of its operating profit, making it the true core of the business.

In this regard, HSBC says it expects the division—which can rely on such iconic brands as Dior—to see its sales rebound noticeably in 2026. This momentum should be supported by several changes within the management team, notably the arrival of a new star designer, Jonathan Anderson, whose style is expected to attract new clients and rekindle enthusiasm for the brand's collections, the bank states.

HSBC thus forecasts a V-shaped recovery for the division's sales, with estimated growth of 10% in 2026 at constant exchange rates, following last year's decline.

In terms of results, margins are expected to improve thanks to better structural cost discipline. However, the broker warns that certain negative factors—such as tax charges, currency effects, and a transitional year ahead for Louis Vuitton—could weigh on the trunk-maker's growth, leading to the downward revision of its price target for the stock.