March 31 (Bloomberg) -- Vipshop Holdings Ltd. rallied to a one-week high after Goldman Sachs Group Inc. recommended buying the online fashion retailer, citing its significant growth potential.
American depositary shares of Vipshop climbed 8.2 percent to $149.30 in New York, extending the company’s surge this year to 78 percent. Vipshop has climbed 23-fold since its U.S. debut in March 2012. The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. advanced 0.4 percent to 99.12.
The retailer’s share of the Chinese apparel market is expected to grow to 1.5 percent in 2016 from 1 percent this year, translating into revenue of $6 billion in 2016, Goldman Sachs analysts led by Weibo Hu wrote in a note dated yesterday. Vipshop on March 3 forecast first-quarter sales will double to as much as $650 million, above an average analyst estimate of $544 million at the time.
Vipshop’s “growing credibility as a leader in discount retail in China will allow it to introduce more global brands, thereby attracting more customers, creating a virtuous cycle,” the analysts said. “We expect the company to seek expansion into further product categories, such as maternal and baby products.”
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