Nomura on China Smartphone value chain overview.pdf

渐飞研究报告 - NomuraNomura || China SmartphoneChina Smartphone December 7, 2011December 7, 2011 China Smartphone EQUITY RESEARCH TECHNOLOGY Tour take-away: strong operator channel sales   December 7, 2011 First Look Breaking news, market events and company announcements Action: trip reaffirmed our bullish on market growth Research analysts We visited nine smartphone-related companies between 5-6 Dec in the Shenzhen area. From the trip, we confirmed strong low-end smartphone China Technology demand in the operator channel driven by operators’ subsidy policy, but Leping Huang, PhD - NIHK the open channel smartphone market remains immature due to price. leping.huang@ +852 2252 1598 We noticed China handset OEMs are expanding their product portfolios into a higher price segment (CNY1,000-1,500/USD150-220) in 2012 in order to improve operators’ ARPU and OEMs’ ASPs after the big success in the below CNY1,000 segment in 2011, but it is still unclear to us whether those models will be accepted in China’s market due to the polarisation of consumer demands. We expect those trends will benefit China Unicom in operators; ZTE, China Wireless, Lenovo, FIH in OEMs, and Sunny Optical, Spreadtrum and RDA in component vendors. Company Meeting memos:  China Unicom (762HK, Buy): Our visit to China Unicom’s shop shows the acceleration of 3G subscriber growth after China Unicom introduced a new service plan from 1 Dec which provides a free low- end smartphone