STOCKWATCH: Legend higher on special interim dividend

HONG KONG (AFX-ASIA) - Legend Holdings shares were higher in mid-morning trade after the company declared it will pay a special interim dividend by transferring one Digital China share for every 10 Legend shares held by Legend shareholders.	    At 11:59 am, Legend was up 0.20 hkd or 3.41 pct at 6.05 hkd on volume of 10.13 mln shares, while the Hang Seng Index was up 48.84 points at 13,323.45.	    Kitty Chan, associate director with Lippo Securities, said investors were happy with the special interim dividend payment declaration.	    "Apart from its sound fundamentals, the dividend payment is no doubt another attraction to the market," Chan said.	    She said the dividend payment through Digital China shares is paving the path to spin off and list Digital China.	    "Like many red chips, the move to spin off a unit for a separate listing has become an incentive for investors to buy the company," Chan said.	    Chan said the market is confident in Legend's PC sales in China as the penetration rate in the mainland remains low.	    "The company has positioned itself well after years of effort in China's PC market. The company is expected to take on foreign competition after China's entry into the World Trade Organisation," Chan said.	    Currently, Legend has a share of about 30 pct in China's PC market.	    However, Chan said there are risks to Legend trading above 6 hkd.	    "The stock is trading at a PE of about 86. With its foreign counterparts having been battered in terms of share prices, Legend's valuation is too high," Chan said. 

Related stock : (NIL)