What does the new Hong Kong store in China mean? Well, it just might mean a riot or a revolution or a madness like they’ve never seen before, with lines for blocks and people sleeping outside for weeks just waiting for it to open. Seeing how the iPad 2 sold out in four hours in China, and there were fake Apple stores sprouting up like weeds, when Apple opens up a store in Hong Kong on September 24 the place might just go completely nuts.
The real question though is what is this worth to Apple’s stock. And not just this one store but the slow building up of more and more stores across China and more and more people falling in love with Apple’s products and brand. When this happens, what is going to happen to Apple’s stock? Right now, in the United States, there are 243 stores and in China there will be six, as they have four now and will open another one in Shanghai. Apple already has two stores in Beijing and two in Shanghai.
Sales in the Greater China region, including mainland China, Hong Kong and Taiwan, helped boost the company’s third-quarter results, Chief Executive Tim Cook said in July. Greater China revenue surged six-fold to about $3.8 billion during the three months ended June 25.
“This has been a substantial opportunity for Apple and I firmly believe that we’re just scratching the surface right now,” Mr. Cook said at the time, referring to strong sales in Greater China. “I see an incredible opportunity for Apple there.”
Furthermore, Apple want to tap into all the Chinese citizens who carry a mobile phone. Which they can do via China Mobile, who will release the iPhone to their customers very soon. A few interesting facts from Reuters:
As of end-June, China had 907 million mobile phone users, bigger than the entire population of Europe.
Smartphones account for just a fraction of the country’s mobile-phone market, prompting Apple to say it was merely “scratching the surface” in China.
Let’s say this, if Apple made $3.8 billion in China, with just four stores, what if they get up to 20 or 40 or even 100 stores in the coming years. Calling it a billion dollars per store, that’s a lot of money. Let’s just say when Apple’s stock reaches $600 a share it won’t be a big surprise. Let’s say China’s matches the United Kingdom, with their 31 stores, that’s a lot of Apple products to move and a lot of lines out front of stores.
To me, Apple is increasingly becoming a lot like gold these days: it’s just something you have to own and never really sell.