Comba Telecom 2342 HK; SGX

[winston]

vested

DJ MARKET TALK: HSBC Cuts Comba Telecom Target To HK$12.20
May 20, 2010

1048 [Dow Jones] STOCK CALL: HSBC keeps Comba Telecom (2342.HK) at Overweight, but cuts target to HK$12.20 from HK$13.50, following 1-for-10 bonus share issue in late May.

Says, Indian government lifted informal ban on Chinese telecom operators to import equipment positive to company, "although India accounted for 5% of company's revenue in 2009, we believe it is an important growth area given the 3G network build-out starting from 2H 2010".

Keeps forecast for net profit in 2010 to grow by 42% to HK$799 million.


Source: Dow Jones Newswire

[winston]

vested

DJ MARKET TALK: CS Ups Comba Target To HK$13.50;Keeps Outperform
May 18, 2010

0839 [Dow Jones] STOCK CALL: Credit Suisse raises Comba Telecom (2342.HK) target to HK$13.50 from HK$12.00, as rolls over 16X target P/E to end-FY11, keeps Outperform call.

House says management optimistic about FY10 earnings outlook; although Chinese telcos would reduce FY10 capex on-year, capex on wireless enhancement should grow gradually during network buildout, given wireless enhancement capex usually is back-end loaded.

Adds, despite India's security clearance issues, management enthusiastic about growth momentum in overseas markets; notes India accounted for only about 5% of Comba's revenue, while growth from other overseas markets such as South America, look promising.


Source: Dow Jones Newswire

[winston]

Vested

DJ MARKET TALK: Comba Telecom's Fall Is Chance To Buy - UOB
May 20, 2010

0841 [Dow Jones] UOB KayHian says Comba Telecom's (2342.HK) 9.1% drop to HK$9.49 yesterday likely due to investors' "misunderstanding on the industry seasonality." No company-specific newsflow yesterday but investor sentiment likely hurt by peer China GrenTech (GRRF) reporting 1Q10 revenue down 44.1% on year to CNY159.4 million.

Analyst Victor Yip says Chinese telecom operators followed tradition this year, did not place much equipment orders during first quarter due to seasonality, as activity delayed by Lunar New Year, budget planning process.

Adds 2009 "extraordinary year" as telecom operators squeezed equipment ordering process to 1Q as they tried to expand 3G coverage as fast as they could after receiving 3G license in January 2009. House keeps stock at Buy with HK$12.30 target.

Source: Dow Jones Newswire

[winston]

vested

DJ MARKET TALK:BoA-ML Ups Comba Target To HK$14; Says Buy On Dips
Apr 30, 2010

1147 [Dow Jones] STOCK CALL: Bank of America Merrill Lynch raises Comba's (2342.HK) target to HK$14.00 from HK$12.00 based on target P/E of 15.4X 2011 estimate without giving previous target P/E.

Keeps Buy, notes news India banned import of telecom equipment made by Chinese vendors is opportunity to buy on dip. Says, 85% of revenue from China; Comba's revenue exposure in India estimated to be only about 5%.

Adds, Comba's subsystems products belong to security-exempt product category in India, actual revenue impact would be smaller than 5%. Although gross profit margins similar as compared to China market, earnings impact likely small due to low net profit margin on small volume.

"Despite short term pressure from profit-taking and negative India news sentiment, we expect a series of high margin new product launches in the market within the next 2-3 months, further improving its market leadership."

Source: Dow Jones Newswire

[-dol-]

Bravo, winston.

Your thoughts, please.

[winston]

Bravo, winston. Your thoughts, please.

Ha Ha ... nothing much really....

I think Overseas business will grow. Who can be cheaper than the Chinese ? And they dont have to sell to the Indians only...

PE is 16. Not unreasonable if they can continue to grow at around +20% ...

The current price is before the big breakout on the good earnings.

But the price action was a bit funny yesterday. Somebody was hitting all the Stops yesterday...

Maybe they know something that we dont. Hence, I only bought half my normal position, just in case ....

Yes, I now recall that you like this counter

[-dol-]

Any counter that has done very well at any time gets my attention - this is one of many but have fallen down the pecking order a couple of months back.

The selling really came in the afternoon. Other than a few downgrades, I am not aware of any other adverse news. Strange things happen all the time - these days, I expect many. The speed and magnitude may yet surprise me.

[winston]

Vested

DJ MARKET TALK: ZTE, Comba's Fall On Mobi Warning Unjustified -CS

0913 [Dow Jones] Credit Suisse notes shares of ZTE (0763.HK), Comba Telecom (2342.HK) tumbled Friday after Mobi Development (0947.HK) announced 1H10 profit warning, which raised market concerns on ZTE, Comba's 1H earnings.

"We do not think Mobi is a proxy of ZTE and Comba given they have different product mixes," CS says; notes Mobi relies on antenna, BTS sub-systems business only, but ZTE, Comba have more diversified product mix; also, judging from discussion with ZTE, Comba's management, "both management teams remain highly optimistic" of order flows in 1H10, expect on-year earnings growth in 1H10.

House keeps Outperform call on both, targets HK$36.00, HK$13.50 respectively. ZTE ended Friday down 4.8% at HK$22.65, Comba off 8.5% at HK$7.94.

Source: Dow Jones Newswire

[winston]

Not vested. PE 16; So PEG of around 1. Not so attractive ...

DJ MARKET TALK: Comba's 1H Net Profit Likely +12% Y/Y - Daiwa
August 6, 2010

1417 [Dow Jones] STOCK CALL: Daiwa expects Comba's (2342.HK) 1H net profit to rise 12% on-year to HK$261 million, sales likely +15% to CNY2.0 billion.

Thinks Comba's sales growth in China maintained despite 29% on-year decline in China's telecom capex of CNY92 billion for 1H10; says Comba is late-telecom-capex-cycle beneficiary, benefited from carriers' capex to enhance indoor wireless coverage (e.g. in underground car parks, shopping malls, elevators) following investments in core network (e.g. base stations).

Cuts target to HK$9.13 from HK$11.37. Keeps at Outperform.


Source: Dow Jones Newswire

[winston]

Not vested. From UOBKH:-

Earnings Revision/Risk

• We have slightly tuned down the 2010-12 earnings forecasts by 2.6-4.9% after we fine-tuned the margins and future growth assumptions.


Valuation/Recommendation

• As an integrated wireless coverage solution provider with strong R&D capability and highly innovative products, Comba is well positioned to benefit from the Chinese telecom industry’s continuous capex spending on wireless coverage enhancement as well as increasing business opportunities in the overseas market.

Therefore, we believe the recent share price weakness due to low 1H10 PRC capex and temporary India import ban creates another good opportunity to BUY.

Our latest target price of HK$11.80 (from HK$12.30) is based on 15.5x 2011F PE or 0.7x PEG (and the target will be adjust to HK$10.70 after the bonus issue become effective).