Ferrari Debut on the Milan Stock Exchange

The Italian luxury giant continues its market expansion in the time when the financial markets were sinking due to the situation in China.

Abel Amón. 14/01/2016

On the first working day of 2016 Ferrari began trading on the Milan stock exchange, after starting his career in the New York Stock Exchange last October. However, the day began convulsing across the world, as the Shanghai Stock Exchange collapsed and after falling 7% suspending trading on the Chinese parquet, infecting the rest of the world stock markets. In fact in the first steps by the Italian park, the value of the luxury car maker collapsed and it became suspended from trading. Finally there was some calm and Ferrari quotation ended up 0.43%, closing at 43.24 Euros.

Ferrari California T
Ferrari California T

Ferrari quote alone, after separating the Italian-American group Fiat Chrysler Automobiles, and will be controlled by the holding company Exor, the Agnelli family. After separation between FCA and Ferrari, all shares of the Italian-American group in the Italian luxury company pass a new Dutch company, FE Interim BV, newly formed for this purpose. The split is part of a series of operations to separate FCA involvement in the mythical home of Maranello and distribute its shares to the shareholders of the group.

Ferrari F12 tdf
Ferrari F12 tdf

FCA partners will stay with 80% of Ferrari and controls by the Agnelli family, which de facto control through its holding company Exor with 33.4% of the shares with voting rights will remain controlled. The idea of ​​Ferrari IPO was that exceeds the market value of 10 billion EUR, however, the current situation in financial markets has hindered this end and today its value is around 8 billion. In the third quarter of 2015 the company has experienced sales growth both in physical units (20% to reach 1940 units) and turnover in EUR. This growth has occurred mainly in traditional luxury markets (USA and EU), while in emerging market (notably in China) Ferrari has slowed its expansion.

Details, Ferrari
Details, Ferrari

Ferrari continues to be its exclusive luxury, producing fewer vehicles (about 7000 / year) than of demand and not by lowering the minimum sale price of € 180,000, much higher than, for example, the cheapest of Lamborghini. The marketing support strategy is based on its team of Formula I as well as the merchandising shops worldwide with products with the slogan of the Cavallino Rampante. The online trade in these products has grown considerably.

La Ferrari
La Ferrari

The company has an enviable financial strength with a lower percentage of debt of 15% of total assets, liquidity ratios well above its competitors in the luxury market, a close to 20% operating margin, and inventory days almost negative because remember selling a lot less than they could.

Ferrari Diseño 5
Ferrari Concept

The current situation in financial markets is very difficult, due to the cooling of the Chinese economy where we have seen, their stock markets have plummeted or this despite the efforts of his government to avoid the drain on capital outflows, on the markets. Chinese cooling immediate consequence was the fall in oil prices with a consequent negative effect on crude producing economies, which have been on the other large consumers of luxury goods.

Ferrari F12 Berlinetta
Ferrari F12 Berlinetta

Disclosure: The medium is not responsible for the views expressed in the article. The text was written freely expressing ideas , without receiving any compensation. The author has no business relationship with any of the companies whose shares are listed in this article.

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