STOCKWATCH: Legend higher on technical rebound/restructuring plan

HONG KONG (AFX-ASIA) - Legend Holdings Ltd shares were higher against a weaker market on a technical rebound after losses last week, dealers said.They said the likelihood of the company undertaking business restructuring will help sentiment in the stock.The company earlier said it plans a restructuring via the spin-off of a new holding company for a separate listing.Analysts said, however, that they will maintain their recommendation on the stock in the short-term until details of the restructuring plan are known.At 11:10 am, Legend was up 0.1 hkd or 1.78 pct at 5.70 on volume of 8.33 mln shares, while the Hang Seng Index was down 2.99 points at 13,963.44."Legend had been oversold Friday and therefore a technical rebound was seen this morning," Belle Chan, analyst at Salomon Smith Barney, said."The news about the company's intention to spin off its unit is positive as it will bring in net proceeds to the group," she added. But she said since there are no details yet on the restructuring plan and which unit is referred to in the company statement, it is difficult to predict the actual impact on Legend.She said she recommends a "buy" rating on the company with a target price of 8.0 hkd given the positive outlook on its core business.Patrick Wong, analyst at Asia Financial Securities, said Legend was higher this morning partly due to the restructuring plan."The news is positive to the company in the long term if the unit to be spun off is the Internet business, since it is a cost centre at the moment. It hasn't made any contributions to the company so far," he added. But he said he will not revise his recommendation on Legend before the details of the restructuring plan are announced.He said the company is recommended as a "trading buy" with the resistance level at 6.30 hkd. pl/zr/av

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