Shoppers are spend, spend, spending - with retail sales climbing 8.2 percent in October, figures released yesterday show.
Adding to the festive cheer, cosmetics retailer Bonjour Holdings (0653) forecasts revenue during Christmas to grow 20 to 30 percent against last year's figures.
Shopping malls are also expecting the season to be merry. Harbour City expects double-digit revenue growth this month - with Christmas Eve foot traffic alone estimated to rise 10 percent to 330,000, said Canis Lee Lai-yi, the mall's assistant general manager responsible for leasing business.
Bonjour's turnover for the first 11 months ended November 30 rose more than 20 percent and same-store sales also surged 20 percent.
With such strong sales growth, it plans to open up to four stores in Hong Kong next year.
It has opened four stores over the past two months and another will open in January.
Footwear retailer Le Saunda (0738) is also targeting double-digit growth of same-store sales during the holidays, chief executive Alice Lau Shun-wai said last month.
JPMorgan economist Grace Ng said: "Going forward, consumer sentiment and household spending is likely to continue to improve steadily in the coming quarters."
Consumption is expected to benefit from the global economy recovery, falling jobless rate and "notable gains in the asset markets," Ng said.
Others are cautious, noting that the largest jump in retail sales in 14 months was chiefly due to a low base set in October last year when the global financial crisis hit.
The Hong Kong Retail Management Association expects growth in the retail market to moderate to 3 percent during Christmas as fewer mainland tourists are expected.
"But if the Shenzhen non-resident visa is available then we might see more upside," the association said.
It said the strong October sales were partly due to the longer Golden Week this year coupled with the Mid-Autumn Festival.
The government sees improvements in the economy supporting retail sales.
"The expected progressive improvement of the local economy, aided by a more stable labor market, should continue to support consumer confidence and hence the performance of retail trade," a spokesman said.
Bank of East Asia (0023) chief economist Paul Tang Sai-on projects retail sales in November and December to grow modestly.
"Retail sales may grow 8 percent to 9 percent in the fourth quarter, with November and December rising by a high single digit," Tang said. He expects total retail sales for 2009 to dip 0.8 percent when compared with last year.
According to data from the Census and Statistics Department, retail sales value reached HK$22.8 billion in October, with sales of medicine and cosmetics rising 18.4 percent. Department store sales were up 15.9 percent while sales in jewelry and watches increased 17.9 percent by value.
