Hermes International, a French luxury fashion group, is now second top ranking fashion company with a market value of over $218 billion and has become the eighth-most valuable company on the pan-European Stoxx 600 index.

The company, second only to another French company LVMH Moet Hennessy Louis Vuitton valued higher, has outperformed other luxury goods brands. The catalyst for the company's recent success has been China, with demand re-emerging as Covid-19 restrictions in some cities lifted last summer. The return of free-spending American tourists to Europe has also driven sales in key luxury markets such as France, Italy, and the UK.

The company, famous for its silk scarves and the iconic Birkin bag, is increasingly confident in withstanding economic downturns, with China's post-Covid recovery and reopening seeing a bounce back in demand for high-end fashion and accessories in Asia. Demand for Hermes handbags has exceeded production capacity, with some airport stores only displaying the bags due to their unavailability, despite starting prices of $10,000 and upwards for the most popular models.

Hermes will open a new leather manufacturing plant in Louviers, Normandy, tomorrow, with plans to boost output.