Legend ist sicher eine der vielversprechenden Aktien in China.Price Target ¡X HK$32.40(3mth) HK$37.70(12mth)
Legend Holdings surged 67% since the release of the better-than-expected 3rd quarter results on 26 Jan. At that time, we had revised up our 12-month target price to HK$30.00, triggered by our earnings upgrade by 12.3% and 13.9% for FY00 and FY01, respectively.
We revised up our target price further mainly based on our estimated value-added from the projected Internet subscribers that Legend will have by the end of FY01.
Our projection of the no. of Internet subscribers is based on our forecast on the accumulated sales volume of Conet PCs by the end of FY01, given that each buyer of Conet PC will be granted a one-year free access to the Internet. We previously estimated the sales of Conet PCs will account for 15% of the total Legend PCs sales in FY01. This will result in an estimated 350,000 subscribers for Legend Internet service by the end of FY01.
We value the EV/sub for Legend at US$5,000 each, which is the same level as that of I-cable (1097.HK). Legend¡¦s Internet subscriber base will subsequently be worth at about US$1,750m (HK$13,650m), or HK$7.73 per share.
der letzte Preisanstieg war wegen der Beteiligung von PCCW
Market talk has it that PCCW will invest in Legend (992) $33.00 Hold, and that Legend has reached an agreement with PCCW to install software for using PCCW's broadband services (NOW) on its PCs and to manufacture set-top boxes. Legend's share price shot up 13% yesterday.
If the JV materialises, we believe it will be positive to both companies. Legend already has over 25% market share of China's PC market, and this will provide an effective channel for promoting PCCW's broadband services.
Additionally, Pacific Convergence could provide contents for Legend's portal, fm365.com. Currently the portal provides six channels, which includes news, education, entertainment, life style, stock market and shopping information.