Citi has released a research report indicating that Legend Holdings is reportedly exploring the sale of its approximately 90% stake in Luxembourg-based private bank Banque Internationale a Luxembourg (BIL). This business currently accounts for roughly 9% of the bank's estimated net asset value (NAV) for Legend Holdings, based on the report.
The firm, which maintains a "Buy" rating on Legend Holdings with a target price of HK$21.5, noted that preliminary bids, due around the end of September, imply a valuation for BIL of at least EUR 2.5 billion (approximately HK$22.5 billion) on a 100% basis. This figure is roughly 3% higher than Citi's latest estimate of about HK$21.8 billion, which was calculated using 0.9 times book value as of mid-2026.
BIL has been a steady profit contributor for Legend Holdings over many years. However, Citi anticipates that, driven by the robust growth momentum of Lenovo Group, BIL's earnings contribution to Legend Holdings will decline to between 10% and 13% of total net profit by fiscal years 2027 to 2028.
The potential sale, according to Citi, could represent the first step for Legend Holdings in divesting non-core investments and transforming into a more focused technology holding company. If the deal materializes, it may help narrow the substantial NAV discount, which Citi estimates at up to approximately 75%. The target price is based on a 72% discount to the estimated 2027 NAV of about HK$76.81 per share, which is one standard deviation below the historical average discount.
Comments