Motorola introduces nine new mobile phones

Motorola announced on last Thursday, the company would launch nine new mobile handsets this quarter.

Among them is a luxury version of the Razr2, the latest successor to its once top-selling model. The Razr2 V8 is being touted as a potential holiday gift with gold-plated accents, snakeskin texture, ultra-slim design and storage of up to 1,000 songs, among other features. It costs US$250 to US$300.The company said four of the seven new W-series phones the W160, W180, W213 and W377 feature FM radio, which requires headphones. Six of the handsets contain Motorola's proprietary CrystalTalk technology, which automatically adjusts audio for clear calls in noisy environments. The company also introduced the Moto U9, a lightweight phone and music player with clamshell design and stereo Bluetooth wireless technology, a two-megapixel camera with 8x zoom and multiple messaging capabilities.

News boosted Motorola?s share price. Motorola was losing market share in 1H07 affected by slower-than-expected market response to the launch of new flagship models. The stock is down 8% for the year but has started to rebound androse 9.3% to $18.53 in Sep 07.

DBS Vickers - Jurong Tech Ind Corp

S$0.76 HOLD Price Target : S$ 0.78 (Prev S$ 0.90)

2Q07 results still muted.

For the interim, revenue fell 24.4% to S$414.3m, while earnings slipped 21.5% to S$26.7m, meeting 36.6% and 39.8% of our original FY07 estimates. JTL also declared an interim dividend of S$0.01/share, versus S$0.02 for the same period last year.

Sequential recovery from 3Q07. Going forward, JTL expects to see sequential recovery in both top and bottom line in 3Q07, driven by a 20- 30% pick-up in orders from its major handset customer for battery packs and complete box-build of new PDA and 3G phones. JTL revealed that it will also commence the production of battery packs for a new customer soon, but we believe the main boost will come in 4Q07. JTL also expects positive contribution of 5-10% of 4Q07 revenue to come from ULC (ultra-low cost) GSM modules, handsets and WLL (wireless local loop) phones.

Execution risk remains. As such, JTL said 2H07 performance should be better than that of 1H07. But we believe that execution risk remains; we remain unimpressed by the new phones from its major customer; JTL is still untested in the ULC arena and could face a long learning curve; potential impact from sub-prime worries in the US on overall consumer sentiment and major customer?s sale. Due to the poorer operating matrix, we have also cut our FY07 and FY08 earnings estimates by 13.1% and 17.6%, respectively. This means our fair value will ease from S$0.90 to S$0.83, even as we push out to 6x blended FY07/08 PER versus 6x FY07 previously.Jurong Technology Limited (JTL) posted a pretty muted set of 2Q07 results as expected, with revenue down 21.4% YoY and 10.2% QoQ at S$196.0m, in line with our forecast of S$196.8m, as its business was still affected by a ?delay in major customer?s execution plan?. No surprises here as that handset maker contributes around 60-70% of JTL?s revenue. Although net profit dropped 20.6% to S$13.9m, it was up 8.7% QoQ, and also ahead of our forecast of S$10.5m. However, we note that the earnings were boosted by an one-off investment gain of S$3.8m and a forex gain of S$4.0m. Excluding these gains, profit from its core operations actually fell 34.9% YoY and 20.9% QoQ to S$11.7m.