Demand for Prada Holding BV's initial public offering of stock, expected in June, is considered strong, although the timing puzzles some analysts.

The fashion group's IPO would create a public luxury-goods group to rival leaders LVMH and Gucci. The industry's tumbling market valuations would make the Prada shares a good deal for investors, analysts said, but they added that it isn't clear whether the offering would be so good for Prada.

Prada is expected to float about 30 per cent of its capital in June for about 2bn euros, according to media reports, although the company declined to confirm those figures or comment on its IPO plans.

Patrizio Bertelli, Prada's chief executive and the husband of creative director Miuccia Prada, shocked the market late last year when he said the family-held fashion empire was planning an IPO to generate cash for acquisitions.

The funds also are likely to be used to pay off Prada's debt of 1.2 trillion lire (619.7m euros).

Prada is expected to pique investor interest for its internationally recognized brand name and its stable of recently acquired businesses, including Helmut Lang, Jil Sander and shoemaker Church & Co. Prada has also taken an equal stake with LVMH in a joint venture that controls 51 per cent of Rome-based fashion house Fendi.

"There will be a lot of demand for shares in a sector dominated by LVMH, and to a lesser extent, Gucci," said an analyst who described Prada as a "quality brand."

Analysts said growing uncertainty about the global economy and the strength of the yen don't make an ideal backdrop for a luxury-goods IPO, but they added that investors would benefit when the offer is priced.

"Luxury-goods peers have valuations that are depressed because of all these question marks," said one analyst, noting potential bargains available to investors. But Prada, which already postponed the IPO to June from the spring, might be wiser to wait even longer, he said.

"You can question whether or not to go through with an IPO now, when we are so uncertain about where things are going from here," the analyst said.