18th October 2007 : Leadcom voted "AIM International Company of the Year for 2007"




Main Web Site : http://www.leadcom-is.com/

Investor Relations Email : investorsinfo@leadcom-is.com

All buys again today I see. Two identical buys for 40,000 each at the end, an institution? . The only unknown was a trade for 50,000 which went through at 88 I think, so suggests a buy again. All buys were paying 86.6 - 88, including a market maker buy of 25,000. All hopeful signs especially since the market maker for this share is also the house broker I think you said.

All positive Saintserf, can see some more position taking going on, then some time in the next couple of weeks some news, not the major one I think, but something :)

I was a bit worried about Huawei reducing margins by cheaper pricing however this bodes well :

................."Then, the crunch: At least 30 percent of the equipment supplied, by value, must be manufactured in India. This would be possible for the vendors mentioned above, but could put in doubt the potential success of any bids from Chinese vendors Huawei Technologies Co. Ltd. and ZTE Corp. (Shenzhen: 000063 - message board; Hong Kong: 0763).

"Most vendors have or are preparing to invest in Indian manufacturing," note the Lehman analysts in a research note issued today, but "right now, Huawei and ZTE have applied for a manufacturing license, but do not yet appear to have received these yet."

In addition, the analysts believe Huawei could struggle to meet some of the other requirements for the core network elements, and that "ZTE may struggle to meet the technical requirements of the tender."

And that's apart from Huawei's relationship problems with the carrier. (See BSNL Shuns Huawei.)

The successful bidders will then be involved in a three-phase build-out of 17.5 million lines in Phase 1, then 14 million lines in each of Phases 2 and 3.

The Lehman team believes "the superior economies of scale enjoyed by Ericsson, Nokia, and Siemens in GSM/WCDMA give all three a very strong platform for the bidding process," though they note that Motorola Inc. might submit a competitive bid: "The Indian market is also one of the last major GSM regions for Motorola, and it may be reluctant to lose more share."

Originally, the BSNL tender was due to be for about 60 million lines, but Alcatel and its Indian partner ITI Ltd. have already been handed a chunk of network expansion work".............

The future spend in India is mouth watering really, and you see why LEAD has a JV set up and ready to go :

..........."Market research firm Gartner Inc. forecasts India will spend 739 billion rupees ($16.34 billion) on telecom services and equipment in 2006, up 27.3 percent from this year. As the table shows, it expects to see a compound annual growth rate (CAGR) of 23.1 percent from 2004 to 2009, when spending will reach 1.42 trillion rupees ($31.37 billion).".........

For those wanting an update on the tender, it is as below, the submission, opening and actioning of the bids is all done of the same day, meaning the 31st of May is the date the award should be known. The 28th April submission was put back under earlier ammendments to 10th of May, now 10th of May is postponed and put back to 31st of May


"Tender No.MM/CMTS/032006/000301 dated 22.03.2006 for Planning, Engineering, Supply, Installation, Testing & Commissioning of IMPS 2G/3G Combo network for 45.5.millions lines."

The latest update is now :

No. 11-03/2006-MMT (CMTS) Dated 03.05.2006

Subject :- Tender No. MM/CMTS/032006/000301 issued on 22.03.2006 for planning, supply, installation and commissioning of IMPCS 2G/3G COMBO Network for 45.5 Million lines Regarding change in activities schedule.

The activities schedule of the subject tender notified earlier on 28.03.2006
and 10.04.2006 is modified as under :-

(1)
Reply to queries of bidders
10.05.2006

(2)
Submission and opening of bid
31.05.2006

Other terms and conditions of the tender document remain unchanged.

(S.P.Singh)
ADG (MMY)

There is a vote of confidence I think, Leadcom is now a top three holding for the Marlborough Special Situations fund (from IC fundies article today)

Interesting couple of posts from AFN :

jonfa - 6 May'06 - 09:11 - 748 of 752
an awful lot of leadcom job vacancies in india - they must be fairly confident!

http://www.leadcom-is.com/careers.asp?CatID=9&country=India


steveb3 - 6 May'06 - 11:08 - 751 of 752
Great find Jonfa.
What is very interesting about this recruitment drive is that India already merits its own MD and Project Manager yet, Leadcom is currently recruiting a single MD and project manager to cover all of Africa and Europe combined.
Since their African business is growing at a CAGR of over 50% and with Europe already accounts for over 40% of total Leadcom sales, the above appointments are clearly a very strong pointer as to the importance of India to future growth.

Altium Securities Report dated 27 Feb 2006, Global telecoms services investment is forecast to increase to more than $1,200bn by 2008, according to industry research firm IDC. Wireless services are expected to account for the majority of that, reaching $800bn in 2010, up from approximately $625bn in 2005. The majority of this growth will come from emerging markets. There has been talk in India of operators being granted 3G spectrum for free on the understanding that they provide the investment to roll out the network. In other words, the next wave of growth behind the current stage of infrastructure expansion already looks secure.

L2 up today on a 10K buy, stock must be getting short now, and with news due fairly soon, we should start to see another move upwards before too long I think.

Any news on the big Indian tender will have a rerating effect I feel, its a potential company maker deal, and with the price on a low earnings ratio as it is now, I see LEAD as a "perfect" stock to hold for now, undervalued and with a deal in the possible pipeline that could rerate the stock upwards to much much higher levels.

hi, papal power. I must confess. I'm afraid I'd been getting a bit lukewarm about lead lately. I thought maybe given its big rise this year , 50 - 87, it might take months before another rise. Impossible to say. I don't mean to be naive but do you think that much can be read into price movements on such low volume?

Saintserf, they are on a single figure forward pr PER rating, and this does not take into account the Indian JV and potential for a billion dollars or more cut of the big tender. Anything under 100p is undervalued I think solely on the present order book, if they get the big Indian tender then it could easily more than double from here, its a company maker.

Altium are now off of the offer, so perhaps the restraints are now off.....and it can move.

Interesting that Altium went direct from offer to bid yesterday, we might see a couple of steps up in the run up to to India news, up to a higher level, see what sells they can get by holding there, and then up again to a higher level.

The Altium price target of 110p (was it that, cannot remember now) does not take into account anything to do with India at all, it only is based on current order book status as from the contract win RNS, which was when they upgraded from their other target in the 27th Feb report.
Throw in a potential billion dollers over 2 or 3 years (07 to 09) and see what that does to forward earnings ratings. With a massive order in the bag, the pr EPS for 07 could well jump from around the 9p to 10p level this current year, up to the 20's for 07 and more 08 and 09. That is why, in my opinion, the Indian JV and the Indian potential is a company maker for LEAD.

Pressure building now, can we move on up to just under the 100p level soon ? ;)

ALTI back on the offer trying to slow it down I think, they must still have orders to fill.

L2 2 v 1 @87/89

And more and more :)

My short term targets are 110p with no further news and then the Q2 trading update, or over 200p if they get the Indian tender awarded in early June :) Just my thoughts and targets !

PP - I like the steady inexorable rise of this one, nothing terribly showy, just bit by bit (apart from the little April dip).

Having said that, if you are right, any part of the Indian tender would probably make it very, very showy indeed!

:)

From macansys' comments and observations it looks like Altium are trying to fill up "their clients" with as much as possible "prior" events. Buying was getting too much and with no real sells coming in, even after a long pause, it was time to step up and see if they can get some sells out at higher levels, but still I would say controlled movements, they will hold where they can, might even drop back a point or two to try to ease some sells out, as time is running out, and June beckons more quickly now.

I am expecting more days like this ahead as the end of the month draws near, each one moving to the next level, to try to tickle a few weak holders into selling out, then perhaps a step back, and then a hold, and then the next one :)

We will see.

Altium Capital 31st March 2006 issued a reiteration of their BUY recommendation and set a new target price of 105p.

Has anyone seen a more recent figure ? Or are they "avoiding" a new figure until after the Indian deal comes in ? ;)

Nope, but I was looking at altium's 44 page buy note from february when they had a price target of 90p when it was at 70p. So people then have made a 30% profit. I wonder with so many institutions mopping up shares if there's a problem with liquidity. Today's buys were very small, they looked to me like ordinary punters buying because it was rising, maybe I'm wrong. Looking at the buy note I was pleased to see altium are forecasting earnings growth of about 25 - 30% a year for the next 3 years, although they themselves say this is "conservative". We'll see. I'm thinking lead might be a share to forget about and leave for a number of years as it's got a big market it could grow into. I wonder if with the lack of liqudity it's not a share that will be volatile in the short term.

Saintserf, yes the original target was a "conservative" 90p, then this was upgraded after the Q1 trading update to a "conservative" 105p. If you were to put LEAD onto a times 20 pr PER ration (low for the sector and also for the growth they are pushing out) then the price should be over 150p. HOWEVER, the big one is India, for if this multi-billion order comes in, you can imagine what it will be doing for earnings. At the moment they are holding the price back whilst behind the scenes "orders are filled" I think. I do not expect it to be below 100p by the end of this month.......we will see. (The Indian tender is due for submition on 31st May)

Retrace today with the market sentiment, time to build up some more next week I think.