HomeChina Stock News China Unicom to see slower revenue growth in 2008, researcher
China Unicom to see slower revenue growth in 2008, researcher
Written by Administrator
Friday, 04 January 2008
BEIJING, Jan. 3 (InfoChina) – China Unicom (600050.SH; 0762.HK; CHU.NYSE) will see slower growth in revenue in 2008 but its profit will outgrow revenue, predicted China Merchants Securities (CMS).
CMS said China Unicom will meet greater pressures in competition with China Mobile (0941.HK; CHL.NYSE) this year, which has incurred slowdown in revenue rise in spite of increase in mobile phone user number.
It also said China Unicom will see cost control as a key factor to keep its profit growth in 2008. It will continue the current marketing strategies, including splitting the sales department for GSM network and CDMA network respectively and establishing customized mobile phone business through its subsidiary Unicom Vsens.
China Unicom launched the two marketing strategies in 2006, after Li Gang took the post of vice president, when the company also began to inject continuous investment in its GSM network. These strategies show their effect in 2007 by maintaining a growth in GSM business and promoting the profit-making capacity for CDMA business.
However, though still effective in 2008, said CMS, these strategies will be of little assistance to the company in increasing revenue. That is because China Mobile has an unfair advantage that cannot be shaken. And though cost control can help increase profit, China Unicom will have a limited space for reducing cost.(Edited by Li Xiaoyu,
)
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