This Company Thinks the Doors are Opening for Argentinian Luxury Goods and Real Estate

Photo provided by Gaucho

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Gaucho Group Holdings Inc. VINO is a company that through its subsidiaries, invests in, develops, and operates real estate projects in Argentina. The company also owns and operates Algodon Mansion, a luxury boutique hotel in Buenos Aires; and Algodon Wine Estates, a winery and golf resort with tennis courts, dining, and hotel amenities in Mendoza, as well as sub-divides property for residential development. In addition, it distributes and sells high-end luxury fashion products and accessories, as well as its premium wines, through e-commerce platforms.

Gaucho Group Holdings (GGH) states that its mission is to increase its scalability, diversify the company’s assets and minimize political risk. It says that its goal is to become the LVMH Moët Hennessy Louis Vuitton LVMH or Burberry Group PLC BURBY of South America. The Gaucho brand also diversifies outside of Argentina. Together with its wines, these aspects of its business may have the potential to protect it from economic and political fluctuations in Argentina such as the volatility of the peso. 

GGH concentrates its 2 main markets in retail and real estate – mainly its hotel and resorts business. However, it says that its luxury goods business is thriving. During the economic crisis in Argentina, iconic international fashion chains left the country. As scarcity is the mother of invention, that departure gave rise to local brands that made up for the absence.

Argentina’s continuing challenges with inflation and unemployment had made it difficult for local labels to break into the global fashion landscape, and today no Argentine fashion brand is a household name. The country lacks international mainstream exposure, and GGH’s leather goods and accessories brand, Gaucho - Buenos Aires is looking to fill that void. Its intention is to become the leading fashion and leather accessories brand out of South America.

GGH states that it has assembled a talented team who speak in the unique voice most representative of Argentina’s local fashion scene and believes it has the opportunity, the aptitude, and the vision not only to successfully introduce this voice to the world’s fashion scene but to become a major player in that landscape.

GGH designed its U.S.-based e-commerce website to showcase the Argentinian luxury goods available to the U.S. marketplace and elsewhere around the globe. It believes the devaluation of the peso can have positive ramifications for the tourism industry. Tourists from outside Argentina can spend more money at hotels, restaurants, and other attractions with a favorable exchange rate. GGH will take advantage of the historic low and deep devaluation of the Argentine peso by producing many of its products and wine in Argentina, thereby paying for product and labor in pesos, enabling it to sell to consumers at a favorable exchange rate in USD to the U.S. and the world. 

Currently, one of the few ways to buy Argentine goods is to travel there and buy locally. GGH wants to change that, and in a favorable economic and political climate, seeks to be at the forefront of opening Argentina’s luxury market to the millions of potential customers around the globe interested in luxury items from Argentina.

Financials

Gaucho believes that the COVID-19 pandemic put a dent into the retail, real estate, and hospitality sectors, and as the sectors come roaring back, investors will be inclined to buy a luxury brand name on the cheap. The past 2 quarters are showing a rise in revenue and gross profits and given the holiday season coming up, the hybrid workforce, and the winter months coming, GGH sees a big uptick as a possibility. Longer-term, it’s a lifestyle and upscale luxury brand headquartered in Miami, Florida, that caters to high-net-worth individuals.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.