Brunello Cucinelli: Risk Reward Update

Research evidence excerpt

Brunello Cucinelli: Risk Reward Update

UpdateM

Risk Reward – Brunello Cucinelli (BCU.MI)

KEY EARNINGS INPUTS

Drivers 2025 2026e 2027e 2028e

Constant currency growth (%) 11.5 11.3 11.0 10.4

Gross margin (%) 75.2 75.2 75.2 75.3

Ebit margin (%) 11.4 11.1 12.0 11.7

INVESTMENT DRIVERS RISKS TO PT/RATING MS ESTIMATES VS. CONSENSUS

Brand desirability RISKS TO UPSIDE FY Dec 2026e

Spending by HNWIs on luxury goods Brand desirability increases

Margin uplift from scale Successful expansion into more categories Sales / 1,550

Additional economies of scale and margin uplift Revenue 1,525 1,558

EUR weakening (€, mn) 1,539

GLOBAL REVENUE EXPOSURE RISKS TO DOWNSIDE

APAC, ex Japan, 262 Mainland Brand desirability fades 0-10% EBIT China and India Key man risk: Mr. Brunello Cucinelli is a critical 257 271

0-10% India asset to the company, having founded it in 1978 (€, mn) 262

0-10% Japan and still being at the helm today

0-10% Latin America EUR strengthening

0-10% MEA 2.31 EPS

0-10% UK 2.19 2.52

OWNERSHIP POSITIONING (€) 2.27 10-20% Mainland China

30-40% Europe ex UK Inst. Owners, % Active 78.4%

30-40% North America Mean Morgan Stanley Estimates

HF Sector Long/Short Ratio 1.6x

Source: Morgan Stanley Research Estimate Source: Refinitiv, Morgan Stanley Research

View explanation of regional hierarchies here HF Sector Net Exposure 7.6%

Refinitiv; MSPB Content. Includes certain hedge fund

MS ALPHA MODELS exposures held with MSPB. Information may be

inconsistent with or may not reflect broader market

5/5 3 Month trends.exposure.Long/ShortSector % Ratioof Total= LongNet ExposureExposure =/ Short(For a

MOST Horizon particular sector: Long Exposure - Short Exposure) /

(Across all sectors: Long Exposure – Short Exposure).

Source: Refinitiv, FactSet, Morgan Stanley Research; 1 is