Long Term Investment Opportunity in Nokia – Post Device Deal


On June 3rd 2013, posted on article on “Is Nokia Worth for Future Investment” and offered insight about potentials around Nokia. The purpose of the article was to offer investment opportunity and subsequently reap in huge upside potential. At the time of last article, Nokia was trading around $3.50 range with market cap lower than $13 Bn. The fast changing market dynamic and competitor environment, Nokia decided to sell its device business with favorable term sheet with Microsoft ignited Nokia share to $6.21 and market cap reached to $23 bn. It represents more than 70% increase in share price. Many early equity investors are in dilemma to hold or sell their equity to book profit. With patent and CTO office, HERE and Network solution business with Nokia, it offer great long term return bet. At the same time, post device unit sellout, Nokia will have net cash position of around $10Bn along with reduced work force of little more than 56000. It is interesting to note that Nokia may fetch more than $1.2 Bn from patent and royalties whereas network solution business unit is profitable and may grow faster than Industry growth given its extended competitive positioning in next generation networking. The HERE business is gaining moment post some big ticket client acquisition. On consolidated basis, Nokia may reach close to $2Bn in profitability without any drag from financing cost. The uptick in steady growth is going to propel Nokia equity price to shore in next one year. In my point of view, post Alcatel Lucent restructuring and continuous struggle with restructuring, Chinese vendor hurdle to get government contract in developed countries is going to offer Nokia Solutions excellent opportunity to extend their market reach and profitability

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Visionary Leader with 22 years of multi-functional experience - combine astute tactical, strategic, business, technology and industry skills in ICT domain at domestic and international level (Wired/Wireless/ networks /platforms/ connected device) .... More

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