China Mobile chairman Wang Jianzhou seems confident over its stock’s outlook even as the share price falls.
Speaking during the company’s annual shareholders’ meeting, the chairman said he was ‘very confident’ about the stock when asked by an investor if it was right to hold on to the stock even after it fell by 12 percent in the past six months, Bloomberg reveals.
“The share price is comparatively low, and our management team is concerned about that and how to realize full value. Management is still very confident in the outlook,” he said.
China Mobile is the world’s largest mobile phone carrier with more than 600 million users and continues to add 5 million new subscribers every single month. The company plans to make a series of acquisitions in Asia.
The company also plans huge investments in its 3G network and expand the number of wireless hotspots in the country in order to lure users in to downloading music and mobile games.
However, despite the confident outlook, analysts believe that the stock will continue to fall as pressure from China Unicom increases.
“We believe China Mobile’s market positioning for high-end users (especially those switching from 2G to 3G) will be severely threatened by China Unicom. Going forward, we anticipate China Mobile to further cut prices or offer more handset subsidies,” DBS Group Research analyst Tsz Wang Tam, said in a statement.