Victoria’s Secrets Revealed as Bramaker Becomes Billionaireby and
Company shares are up 71 percent since October public offering
Regina Miracle founder owns 72 percent of apparel manufacturer
Hung Yau Lit, chairman of the world’s biggest bramaker, can thank Victoria’s Secret for his newly minted fortune.
Hung’s fortune rose to $1.1 billion as lingerie supplier Regina Miracle International Holdings Ltd. has soared since its October initial public offering, according to the Bloomberg Billionaires Index. The Shenzhen-based supplier for top brands such as Victoria’s Secret and Calvin Klein Inc. has surged 71 percent since its debut on the Hong Kong exchange on Oct. 8, including a 12.3 percent gain on Tuesday. Hung, 53, owns 885 million shares, or 72 percent of the company.
“Globally, only suppliers of Victoria’s Secret would be big enough to go public,” said Jackson Yu, an analyst at RHB OSK Securities Hong Kong Ltd. “Victoria’s Secret is pretty innovative in fabric and styles, and its delivery cycle is quicker than other traditional brands. The requirement for suppliers is also higher, so it’s not easy to be a supplier” to the brand.
Regina Miracle advanced to close at HK$9.58 on Tuesday after it reported a 43 percent growth in net profit for the six months ended Sept. 30. Revenue rose 26 percent to HK$2.5 billion ($322 million) from a year earlier, according to a statement to the Hong Kong stock exchange on Monday. The company reported revenue of HK$4.2 billion in the year ended March 31, 2015, according to its IPO prospectus.
For the richest people in China and Hong Kong, the 2015 has been a roller-coaster ride. While a stock-market rally created new billionaires at the fastest pace in the beginning of this year, everything started to sour in June, when a rout wiped away more than $34 billion in combined net worth in the month.
As part of Regina Miracle’s plan to expand, Hung plans to open four plants in Vietnam, with the first one to commence manufacturing by the end of the first quarter next year.
“We are the leader in innovation and quality in the industry," said Hung in a media conference on Monday. "After increasing the production capacity, we will enhance the speed too.”
Regina Miracle generates 35 percent of its sales from Victoria’s Secret parent company, L Brands Inc., according to a note by BOC International Holdings Ltd. analysts Candy Huang and Jamie Shen. It also produces footwear and running shoes for brands including Armour and Reebok. Leslie Wexner, the billionaire founder of L Brands, has increased his fortune 7.7 percent this year to $8.3 billion.
According to a 2006 article in the South China Morning Post, Hung migrated from China’s Fujian Province to Hong Kong with his parents when he was 11. He quit school after junior secondary school and worked at factories before joining a velcro-fastener maker as a salesman, according to that report. Maggie Au, an external media representative for Regina Miracle, confirmed Hung’s ownership in the company, while declining to comment on the billionaire’s fortune. Regina Miracle declined to make the billionaire available for an interview.
Hung first set up the predecessor of Regina Miracle in 1985 as a manufacturer of shoulder pads. As the global demand for the product declined in the late 1990s, he changed his business focus to intimate-wear manufacturing, according to the IPO prospectus, adding L Brands as a client 15 years ago.
The company now manufactures 1 percent of the world’s women lingerie, making it the world’s largest bra maker in terms of production volume, according to a report by Frost & Sullivan in 2014. It produced a total of 58.7 million pieces of bras and panties the year ended March 2015, according to the IPO prospectus.