Legend Holdings (03396) shares surged more than 17%, trading at HK$20.30 as of writing, with a turnover of HK$709 million. This rally follows the company's profit alert, projecting a net profit attributable to equity holders of at least RMB 2 billion for the first half of the year, representing a year-on-year increase of no less than 186%. The significant earnings growth is largely attributed to the recovery in capital markets, which has turned the industrial incubation and investment segment's investment operations from a loss into a profit.
Furthermore, Legend Holdings core asset, Lenovo Group, has evolved beyond a traditional PC maker into a technology giant deeply benefiting from the AI wave. Lenovo Group recently reported record first-quarter revenue, with its AI server order backlog swelling to RMB 360 billion. A recent research report from Essence Securities suggests that Lenovo Group will remain the primary profit driver for Legend Holdings, while Levima Advanced Materials is in a production capacity release phase. The industrial investment segment is poised to benefit from the capital market's recovery and the listing of portfolio companies, indicating that the company's earnings recovery trend is likely to continue.
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