Digital China Holdings is engaged in the distribution of foreign brand information technology products, the provision of systems integration services and the development and distribution of networking products. With year-on-year revenue and net profit growth recorded at 22 per cent and 21 per cent respectively, the firm's interim results last year were broadly in line with market expectations. A UBS Warburg report from nearly a year ago placed a 'buy' recommendation on Digital's stock, identifying favourable growth potential. However, UBS revised its earnings estimates slightly downwards and adjusted Digital's price target from HK$4.44 to HK$4.40. 'Despite a tougher-than-expected 2001, Digital China has managed to hit its 20 per cent earnings growth target,' the report said. 'While market conditions will likely remain challenging, we rate Digital China a buy for its attractive valuation and market leadership in China's IT distribution market.' Graphic: THEN20gwz