Most of the analyst feels that Nokia is under
pressure to deliver both on product and profitability end. I observed that many
analyst writing down Nokia prospect and predicting that it would be an acquisition
target. I feel the other way and with confidence can claim that their strategy
to be one of the best product portfolios would be achieved in next 2 quarter.
Most of the print media focussing on their effort to halt market share loss vs.
competitors in the last 2 years. Here are some of the crude facts for the
critic of Nokia strategy. The major geographies which may impact the total
device market are US, India & BRIC countries.
India Status
In recently published report cyber media about
Indian mobile device market dynamic and Nokia leadership in India clearly
demonstrate that even during transition phase, Nokia managed to hold on their
Number 1 position. It is interesting to observe that Indian market offer full
opportunity for the feature phone where Nokia Asha is giving competitors
sleepless night. On the Smartphone segment, Lumia 500 series with sub $200
range and offering smartphone differentiated feature set attracting lost Nokia
loyalist into their fold again. The recent upgrade of Lumia series across price
point and their potential availability in said geography is going to offer more
muscle power to govern dynamics.
China Status
After losing market share to local player, Nokia
rejigged their china based management team. In the last few months, Nokia
successfully collaborated with China Mobile and Chinese retailers to offer
value for money. The china mobile deal and customized Lumia 920T mass delivery
is only going to help Nokia regain their lost ground in china. The additional
bulk buying of Nokia devices by online Chinese retailers are offering Nokia an
opportunity to predict the expected delivery and according ramp up their cost
effective and efficient manufacturing processes. The China story is not
reflected in their released result last quarter. At the same time, China is one
of the biggest market for feature phone and Nokia offering from $20 to $300
range device for one of most active replacement cycle market is going to play
in Nokia favour only.
US status
The biggest achievement of Nokia with their changed
strategy is US market penetration and successful adoption of product line. Most
of the service providers and retailers are offering Lumia product line. The
recent launch of customized Lumia high end smartphone with Verizon would definitely
bring cheer to all Nokia Investor. Last quarter, Nokia volume was impacted due
to component issues and Nokia is known for seamlessly fixing up those issues.
The recent glitch of iPhone integrated maps helped Nokia to establish their
brand effectively in US. One should not be surprised, if Nokia captures more
than 10% of US smartphone market in Next two quarter.
I also would like to point out that it took
Motorola good three years to be formidable device player post sudden debacle in
2001 whereas Samsung became king of Smartphone after 7 years of heavy
investment in the segment.
What I observed that Nokia restructuring and their
head office sell out got more negative publicity compared to their innovative
product line.
I also would like to request post reader to name
one of the mobile device manufacture who are directly associated with an organization
offering most of your work based software. Nokia was criticized for going other
way and collaborated with Microsoft instead of adopting Android. Everyone
focussed on financial part of it but rarely found any article where the
benefits were mentioned for potential customers.
In my point of view, smart investor should focus on
their patent portfolio, patent win over Blackberry and other companies, licensing
agreement with QUALCOMM, Nokia Siemens Stake, Value associated with Navteq, Ovi
Store and many other. I don’t believe that the current market price and Market Cap
of $ 3.48 and $ 12.92 is anywhere near to reality. It pops up simple query from
potential downfall of share price; the answer is simple- big player moved out
from share due to dividend and restructuring cost.
My recommendation to potential long term investor would
be to analyse it your own and invest for multi fold gain in next one year.
Disclaimer:
Request potential investor to consult their financial advisor before investing.
The above assessment is purely my view regarding Nokia potential
