Citi Research lowered the target price for TCL Communication Technology (02618) to HK$13.3 from HK$14.2, and maintained a "buy" rating.
The house said 3Q14 profit of HK$294 mn was in line with its forecast and consensus. It noted smart device revenue contribution in 3Q was HK$6.8bn up 26% QoQ, similar to shipment growth, implying blended ASP was stable. On the other hand, feature phone revenue contribution was only HK$1bn, down 23% QoQ, implying feature phone blended ASP was down meaningfully.
Citi tweaked its 2014E/2015E/2016E forecast on slightly higher revenue and opex, slightly lower GM. It cut its 2015E/2016E EPS forecast by 7%/5%. The house maintains its view that TCL can register solid profit growth as smartphone volume ramp-up in emerging markets (65+% of TCL's sales) can offset declining margin.
全新節目《說說心理話》青少年不可以戀愛！？真實個案講述驚心動魄經歷► 即睇
