The “3G Mobile China Manufacturing Services Companies Now Satisfy Local ... - Yahoo Finance”

3G Mobile China Manufacturing Services Companies Now Satisfy Local ... - Yahoo Finance

Posted: 13 Jan 2010 04:07 AM PST

67 WALL STREET, New York - January 13, 2010 - The Wall Street Transcript has recently published its China & Japan Report offering a timely review of the sector to serious investors and industry executives. This 132 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Chinese ADRs - Asia Pacific Fund - Greater China Fund - Non-Mainstream Names - China and the US, The Most Vibrant Growing Global Economies - Japan Equity Fund - Expectation of Strong Earnings in Singapore Companies - Thai Government Key Driver for Economic Recovery in 2010

Companies include: Deer Consumer Products (DEER); Lonrho Africa (LNAFF.PK); Nintendo (7974_JP); Puda Coal (PUDA); AU Optronics (AUO); Acorn (ATV); Alcon (ACL); Amphenol (APH); Apple (AAPL); Baidu (BIDU); BioPharm Asia (BFAR.OB); British Petroleum (BP); CNOOC (883_HK); Canadian Natural Resources (CNQ); Chaoda Modern Agriculture (0682.HKG); Cheung Kong Holdings (CHE.SG); China Automotive Systems (CAAS); China Housing & Land (CHLN); China Merchants Bank (3968_HK); China Mobile (CHL); China Ritar Power (CRTP); China Sky One Medical, Inc. (CSKI); China Unicom (CHU); China Valve Technology (CVVT); Chunghwa Telecom (CHT); Cisco (CSCO); Cogo (COGO); Disney (DIS); DuPont (DFT); Ezra Holdings (5DN.SIN); F5 (FFIV); FEMSA (FMX); Fanuc (6954_JP); Flextronics (FLEX); Global Sources (GSOL); HK Exchange (388_HK); Hewlett-Packard (HPQ); Honda (HMC); ICBC (1398_HK); ICON (ICLR); Juniper (JNPR); KONE (KNEBV.HEL); Komatsu (6301_JP); L'Oreal (LOR.BE); LG Display (LPL); LIC Housing Finance (LICHF.IN); MUFG (MUFG); McDonald's (MCD); Mitsubishi UFJ (MTU); Molex (MOLX); Nabors (NBR); Nestle; (NESR.F); Nobel Biocare (NOBN.VX); Orascom Telecom (OTLD_LI); Pargesa Holdings (PARG.SWF); Roche (RO.SW); SK Telecom (SKM); Sanofi-Aventis (SNY); Sasol (SSL); Singapore Telecom (SGAPY.PINK); SinoHub (SIHI); Sinopharm (1099_HK); Sony (SNE); Swiss Water Decaf (SWS-UN.TO); Terna (TRN.BIT); Total (TOT); Total Produce (T70.BE); Toyota (TM); Toyota (7203_JP); Venture Corporation (V03.SIN); WSP Holdings (WH); Wal-mart de Mexico (WMMVF.PK); Winner Medical (WWIN); Wonder Auto Technology (WATG); Xcel Energy (XEL); Yamaha Motor (7272.JP); Yongye International (YONG); Yum! Brands (YUM).

In the following brief excerpt from just one of the 27 in depth interviews from the 132 page Special Report, an award winning analyst discusses the outlook for the electronics manufacturing sector in the Far East for investors.

BRIAN J. WHITE, CFA, is Managing Director of Equity Research, covering tech supply chain, networking and IT hardware at Ticonderoga Securities. Mr. White has covered various industries in the technology sector for 11 years with firms such as Collins Stewart, Jefferies & Company and Merrill Lynch.

Prior to joining Ticonderoga, he was responsible for covering the electronics supply chain and China technology sectors at Collins Stewart, which included researching stocks in areas such as display technologies, China technology, passive components and electronics manufacturing services. Mr. White has been active in researching the technology sector in China over the past several years and hosts an annual tour for clients to cities such as Beijing, Shenzhen and Shanghai.

Mr. White was ranked as one of the leading analysts in the electronics industry category by Forbes as part of the 2009 Blue-Chip Analyst Survey, and he was a member of the number one-ranked electronics manufacturing services team by Institutional Investor Magazine while at Merrill Lynch. He received his MBA from Vanderbilt University with a concentration in finance and accounting, with an international emphasis. He graduated with honors and is a member of Beta Gamma Sigma. Mr. White is also a Chartered Financial Analyst and a member of the New York Society of Security Analysts.

TWST: How big is the risk of inflation in the coming years? Do you have any serious hesitations or reservations about the Chinese government's ability to manage inflation in the foreseeable future?

Mr. White: I think globally there are certain commodities that will be in short supply just because China is coming of age, India is coming of age, there are only so many commodities to go around. But I think in general, the Chinese government itself can get their own inflation rates at fairly reasonable rates.

TWST: What's important from an investor perspective and from a stock growth perspective when you look at things like the 3G buildout in China, and the increased focus on enterprise solutions and servicing in the institutional marketplace as opposed to consumer spending growth?

Mr. White: So I mean, 3G spending started on a trial basis even before the licenses were given out early this year. So we've got three different technologies, and the three big service providers are building out each using a different technology. You'll probably see 3G spending on infrastructure on base stations peak this year, but it really is an ongoing investment. So I think you will see the infrastructure peak.

I believe in the fourth quarter, demand for base stations picked up quite a bit because you have TD-SCDMA phase III going through and WCDMA phase II. So you've got a couple of new phases, base stations to expand the coverage for 3G in China. Next year you will have spending on 3G infrastructure and the year after, but it won't be as great as this year. So this year was the initial buildout but still focused on the networks at the three service providers with three technologies. I think what you will see next year and in the future is the purchase of 3G handsets. So the network is built out this year but the 3G handset sales were disappointing for various reasons. I think you will start to see that pick up next year and the year after.

The 3G handset numbers in China are low millions at best. So you think about what people have in the U.S., most people now have 3G phones. The iPhone was recently launched with China Unicom (CHU), and there are lots of smartphones coming out. The issue you have in China is that the phone numbers are not portable; so to change a service provider, you've got to get a different number. Additionally, the applications are not there just yet. There is one provider that most people like to use, but they are using the TD-SCDMA 3G standard, which I think most people view as still relatively nascent. This is making it difficult for people to make the switch to the 3G phone. Over time we believe these issues will be resolved and 3G handsets will be purchased.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 132 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

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