Bonus for telecom equipment makersTuesday, January 03, 2012
China's telecom equipment providers are likely to benefit from an extension of the integrated network scheme, analysts say.
The State Council announced over the weekend that it will extend the trial scheme - which seeks to
consolidate internet, television and telephone service networks - to 42 more cities.
The move will bring the total number of cities under the scheme to 54, including all four directly governed cities and most provincial capitals.
Although details of the second phase of the scheme are not yet available, analysts said telecom equipment makers are set to benefit in the medium term.
The scheme would boost investments in telecommunications infrastructure, according to Kenny Tang Sing-hing, general manager at AMTD Financial Planning, as demand for bandwidth is poised to surge while network penetration increases.
Some market analysts estimate that the network integration scheme, first discussed in 2001 but not announced until 2010, is likely to proliferate into businesses that are worth as much as
3 trillion yuan (HK$3.7 trillion) by 2015.
Tang believes telecom and cable television equipment providers such as
China Communications Services (0552), Centron Telecom (1155) and ZTE (0763) will benefit. But telecom operators such as China Mobile and China Unicom (0762) will see little upside from the policy.
Various telecom enterprises are also preparing for new opportunities expected to arise from the consolidation of the three platforms.
China Communications Services, for example, has announced a two-for-10 rights issue on both its H and A shares for a net 2.9 billion yuan, in order to expand markets and conduct acquisitions.
http://www.thestandard.com.hk/news_deta ... 20103&fc=2
It's all about "how much you made when you were right" & "how little you lost when you were wrong"